The Upper Hand - Playing It for What It's Worth

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Lower rates. Lower annual fees. More travel points. Everything is on the table if you have a good credit score, are willing to do a little research, and - here's the critical part - don't mind asking for a better deal. "A creditor wants to keep business," notes Tokusan Svenson, an education and counseling professional with American Consumer Credit Counseling. "If a consumer has the freedom to move their balance, a creditor is more likely to give some kind of concession."

Here are a few critical steps to follow to secure the best deal on your credit card.

First things first - start by finding out your credit score. You can't get a credit card company to sweeten the pot without a good score. Find out your FICO score by visiting MyFICO.com or contacting the three credit reporting companies - Experian, TransUnion and Equifax.

Next, determine your top priority when it comes to the deal. "Analyze the perks you're going to get the most out of," Svenson said. Do you carry a balance on your credit card? If so, you may be looking for a better Annual Percentage Rate. Is cash your top priority? You may want to put the yearly fee at the top of your list. Like to travel and wouldn't mind a free ticket to the Virgin Islands on an annual basis? More travel perks might be right for you.

Make a score card, listing perks in order of preference. When you're comparison shopping, this can come in handy.

Now it's time to do a little homework. Spend your time at your computer and scan the multitude of credit card offers that are out there. List them on your comparison sheet, giving extra points to the card company that offers the best deal. Sites such as Bankrate.com provide comparisons. Be thorough - look out for things like an introductory-rate grace period or fees for balance transfers that card providers like to slip in. As Tom Waits once said, "The large print giveth, the small print taketh away."

After you're done kicking the tires of a bunch of plastic providers, you're now armed and ready. When you enter the marketplace and prepare to haggle, you'll be able to cite what the competition is doing to earn your business.

You now know what you want in terms of perks, rate or fees. You know what carrots the competition is dangling in front of you. Now it's up to you to negotiate the best credit card deal. It all starts with the secret weapon of top deal-makers across the globe: You ask for something better.

Think it doesn't work? You'd be surprised how many squeaky wheels get the grease. A national survey conducted by the U.S. Public Interest Research Group in March of 2002 indicated that more than half of a survey group received lower rates simply by asking for them.

If you get a "No," then you might want to ask for a supervisor or call back another day. Remember, front-line people are paid to say no, while managers are paid to resolve problems. Work the system to your advantage.

The key is keeping your leverage. "Make more than a minimum payment, keep yourself below 50 percent of your credit limit, and send in your payments on time," says Svenson. Follow that formula and you'll be in the driver's seat. Bottom line, credit card companies are desperately seeking new customers. (Checked the amount of direct mail solicitations you've received lately?) Reward yourself for that high credit score. You'll thank yourself, and believe it or not, you'll even thank your credit card company.

Negotiable "Plastic Perks"

Here's a partial listing of items that are negotiable with a credit card company. Prioritize what's best for you: • Interest rate • Annual fee and fee details • Travel points • Cash back deals • Reward points for cars, hotels and gas • Fees for balance transfer • Dollars toward college savings

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