2020 Fee Exemption Survey | Bankrate.com

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Chances are you’ll get what you wanted when you ask to get rid of annual or late fees on your credit card, lower interest rates, or raise credit limits in 2020.

But, according to a new survey from Bankrate.com, a lot of people didn’t ask. Millennials and parents with children under 18 – 43 percent and 48 percent of them respectively late paying at least once – are the groups who asked the most and were most successful in getting what they wanted.

That year, 33 percent of cardholders were charged a late fee and nearly half (47 percent) asked to forego it. From the cardholders who post. have asked Late fee Exemptions, almost all (82 percent) received some relief – almost half (45 percent) received all exemptions and 37 percent received some exemptions.

Many Americans are culturally reluctant to seek concessions, said Mike Sullivan, director of education at Take Charge America. Other countries have marketplaces where negotiation is a way of life, but in the US, many people seem unable to ask about any deals – and others either don’t know they can or don’t care, he added . And indolence is a huge problem with consumers, especially when it comes to financial matters.

Most consumers were preoccupied with other issues during the pandemic and they didn’t have the energy or bandwidth to take advantage of some very generous relief options from their creditors, said Martin Lynch, compliance manager and director of education at Cambridge Credit Counseling Corp.

Millennials and parents could be those most in need

Those with the greatest financial stress are most likely to break with tradition, Sullivan pointed out.

Millennials miss their paychecks and parents of school age children often miss or lose jobs during these troubled times to look after those children.

They need relief while older consumers are less concerned about childcare and more likely to have stable jobs and seniority, Sullivan said.

Lynch said both standout groups may be more likely to know help was available and would swallow their pride and seek help.

“I think this is especially true for parents of young children who have already had to transform their lives in many ways,” he said. “The reservations about asking for help were quickly forgotten after dealing with the other problems.”

Check out some other key results from our latest survey:

  • Lower interest rates? Piece of cake. More than three quarters (78 percent) of cardholders who look for a lower interest rate We got some help this year, but only 14 percent of cardholders asked.
  • Say hello to fee waivers. Seventy-three percent of cardholders who requested an annual fee waiver in 2020 received it (43 percent of which received all of their fees enacted and 30 percent have enacted some of them). However, almost half (44 percent) of cardholders were charged annual fees and only 26 percent of them applied for at least one fee exemption.
  • Raising the limit. Many cardholders (70 percent) asked for a higher credit limit in 2020 and got at least one (39 percent every time and 31 percent sometimes). But only 18 percent asked for a higher limit – and of those who asked, 31 percent were millennials and 34 percent were parents with children under the age of 18.

The survey of 2,802 US adults was conducted online between November 18 and 20, 2020. See survey methodology.

Creditors want to help ailing consumers

Take Charge America’s Sullivan said creditors are eager to help consumers – they are concerned about depreciation and losses but need to be compassionate.

They also face declining revenue as consumers use less credit cards and keep customers, he said.

However, many consumers have not asked for help.

Some don’t need help, Sullivan said, but many are unaware of the current credit relief environment because creditors have not always been that helpful.

Late fees are the price consumers always have to pay to keep credit cards when they run out of cash to pay their bills. Aside from making creditors more helpful, what has changed is that more consumers are facing income problems.

“And many consumers don’t like talking to someone they owe money to, regardless of the likely benefit – much like going to the dentist for many,” Sullivan said.

Lynch pointed out that people are less likely to share information about an interruption received from a creditor than the act that triggered the request missed paymentwhich is why people may not know what to ask.

“I think the same group will miss out on additional payments if the next pandemic stimulation law doesn’t include another round of direct payments to individuals,” Lynch said.

Now is the time to ask for lower interest rates

Some consumers never wear scales and don’t care interest chargesSullivan said while others are ignorant of the importance of an 18 percent or 19 percent (or higher) interest rate on a card.

And card companies like insurance companies have established a slowly increasing pattern of costs for existing customers, but most consumers don’t question this until they get an ad for 0% Credit transfer card or another special offer.

Even then, they usually don’t ask their current card issuer to coordinate the offer.

But now is the time to ask for lower APR, as interest rates for banks are close to zero and they can afford to cut customer rates.

In fact, according to Sullivan, some credit card companies are offering unsolicited low-risk price cuts to consumers because issuers must keep every customer.

More people should have asked for an exemption from the annual fee

Consumers who sign up for annual fee credit cards are typically wealthy, according to Sullivan.

Wealthy consumers may well ask for the fee waiver as they may not be using the card enough to justify the cost. (Many fee-based cards include travel rewards and fewer people traveling.) Other consumers with income problems could seek relief in this area as well, he said.

Of course, some annual fee cards offer little more than prestige, but this type of card also attracts consumers who are unlikely to ask for relief.

It is a buyer’s market for credit card customers

“Again, I think the fact that consumers are getting higher credit limits shows that banks are ready to help their cardholders through the pandemic,” Lynch said.

Instead of waiting to see if lending gets tight, some people may choose to access a loan upfront by looking for a higher limit on an existing account or by applying for a different product like a home loan. Then when they lose their jobs they have a cushion to bridge them.

“If that was indeed their reasoning, then it was reasonable,” said Lynch.

Sullivan finds it a little surprising that cardholders are given higher credit limits when asked.

“Some credit card companies were to reduce Credit limits, even for excellent credit risk customers, ”Sullivan said.

Although the number of accounts in distress has decreased since the pandemic began, the economy is still very much insecure. However, Sullivan said credit card companies may be willing to take some risk in order to retain customers and continue to earn fees from highly leverage cardholders.

“This certainly seems like a buyer’s market for credit card customers – or at least some customers,” said Sullivan.

The bottom line

Ted Rossman, industry analyst at Bankrate, said most annual fee card issuers made smart adjustments during the pandemic, such as: Food, Delivery service, takeaway food, Streaming services and cell phone plans.

Cardholders seem to have a lot of leverage when it comes to waiving or reducing their annual fees, Rossman noted.

“I definitely think it makes sense to request a break in the annual fees and not just in the lower fee cards,” he said. “I’ve heard of some phenomenal breaks in high-end cards this year.”

Rossman’s stance on the demand for breaks is “nothing dared, nothing gained”.

Card issuers have pulled back on marketing and customer acquisition and are even more concerned about risk than usual.

If you’re a good customer who has been with an issuer for a while and pays on time, chances are they’ll bend over backwards to keep you.

“Even less popular customers – who are behind with their bills – are often relieved because it makes sense to ask for a break beforehand cancel a card or pay an additional fee, ”added Rossman.

Survey methodology

CreditCards.com hired YouGov Plc to conduct the survey. All figures, unless otherwise stated, are from YouGov Plc. The total sample was 2,802 adults. The field work was from 18.-20. November 2020 carried out online.


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