by Heather Kindberg

Created on: May 25, 2008   Last Updated: June 09, 2008

Credit card companies are incredibly powerful and intimidating. They have major influence in congress, they've managed to suppress laws that would allow states to tighten restrictions on their practices and, with a swift keystroke, they have the ability to downgrade customers' credit ratings.

But it is the customers who give these companies their power. Our collective debt makes them strong. And customers have the right to step up and ask for the things they want. No one has ever randomly handed me a dollar on the street, but sometimes an indigent is handed a dollar just for the asking. If you don't ask your credit card company to accommodate you, what are the chances that they will choose to do it on their own?

Here are five questions you should ask your credit card companies, without hesitation, that could greatly improve your financial picture:

1. What are my options for lowering my current interest rate?

A credit card company charges customers various rates based on the current prime rate, a customer's history, and the company's desire to either acquire new customers or to keep the status quo. Asking them this simple question could feasibly save you a bundle of money.

2. What rate will you offer me for transferred balances?

If you are a customer in fairly good standing, you may save a small fortune with this phone call. Although a company may be charging you a double-digit interest rate for purchases, they may offer an extremely low rate to get you to give them more of your business.

3. Will you reverse my late charge/over-limit fee?

If you are rarely or never late on payments, and don't normally spend over your credit limit, you will very likely hear a "yes" to this question. It's an instant $40 or $50 savings for the asking. These companies want to keep you as long as you keep paying them.

4. Will you raise my credit limit?

This is a question you want to ask in good times, not bad, and the good times are the best time to prepare for unforeseeable future turbulence. When you are in a comfortable financial position, with paid bills and a healthy FICO score, calling your credit card companies and requesting a credit limit increase will help ensure that you have a safety net in tighter times.

5. Can we negotiate a payoff plan?

This is the question to ask if you find that you are in dire financial straits. Credit card companies would much rather get this phone call from you than call you for collection and hear, "Call my bankruptcy attorney." In that case, they know they will likely never receive another penny from you toward your debt with them. On the flip side, these companies often refuse to work with customers until after a bankruptcy has been filed: They want an added assurance that you really can't or won't pay the full debt. But if you can convince them that they need to work with you, they may freeze your credit card from further purchases, lower your minimum payment, stop applying late fees, and they may even reduce your debt a significant amount. If you are in a serious financial situation, calling your credit card companies and asking this question should be your very first move.

As a customer, you have nothing to lose and possibly much to gain by making these requests of your credit card companies. Don't be afraid to hear "no." The answer could just as well be "yes."

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