Get a better deal . . . with a threat

By Liz Pulliam Weston

Threatening to take our business elsewhere can be a powerful way to get discounts, better service or refunds.

Or it can be an embarrassing flop. There's nothing quite like huffily announcing your imminent departure, only to be told -- directly or indirectly -- not to let the door hit you on the way out.

Here are three situations where threatening to take your business elsewhere can actually work to save you money. And the same tactics can work just as well elsewhere -- with your gym, bank or cell-phone provider.

Get a lower credit card rate

The more you need a lower rate, unfortunately, the less likely you are to get one. If your credit's bad, you're late on your payments or you've maxed out your cards, your lenders are probably more worried you will default than that you will depart to a competitor. That's going to make it tough to get a better rate.

If, on the other hand, your credit's good (a FICO credit score of 700 or above) you've got real leverage. (If you're not sure about your scores, you can buy them from MyFico.com or use MSN Money's credit score estimator to get a rough idea where you stand.)

"If your credit score is in the 700+ range … and you have an interest rate for purchases above 12% on your current card, then you definitely need to call your issuer and find out why your rate isn't lower," said credit card expert Curtis Arnold, founder of CardRatings.com.

Before you call, scout out some of the abundant low-rate offers available to folks with good credit scores. You may have a pile of them already, or you can sort through dozens on CardRatings.com and other sites that offer single-digit rates. You can refer to one or more of these offers when you call your credit card issuer's customer service line to negotiate.

Your opening line can be something like, "I've been getting a lot of low-rate offers from other credit card companies and I was thinking about switching to one of them, but I wanted to see if I could get a better rate from your company first."

If you strike out with the customer service rep, Arnold said you should ask to speak to a manager. Point out your solid, on-time payment history and good credit scores. If you're a long-time customer or use the card heavily, mention that out as well.

"If the manager still doesn't budge on your request, then tell him or her that you wish to close your account," Arnold said. "If you have a current balance, tell the manager that you are going to transfer the balance to a lower rate offer."

The threat to close your account should be a hollow one. Even if you do decide to transfer your balance to another card, you typically should leave the old account open to avoid damaging your credit scores. You particularly don't want to close a card with a high limit or one that you've had a long time.

But threatening to close your account usually will get you transferred to the card's account retention department, whose sole job is to try to keep you as a customer. These folks are the ones authorized to wheel and deal.

"It costs card issuers up to $200 in marketing expenses to acquire new customers, so it is definitely in their best interest to keep you as a customer and to accommodate your request if at all possible," Arnold said. "Sometimes, you may get a counter offer that isn't as low of a rate as you had hoped, but lower than your current rate. If you get such an offer, you should first refuse it and continue to negotiate."

Something along the lines of "I was hoping you could do better than that" or "that really isn't low enough to keep my business" might provoke a better, final-round offer. If not, you can accept the lower-but-not-low-enough rate -- then go ahead and apply for one of the lower-rate cards from a competitor.

Similar tactics can work to get a late charge or other fees removed as well, Arnold said.

Get a hotel to comp a night

There are a lot of moving parts to this particular customer service equation. How bad was your experience? What efforts did you -- and the hotel -- make to fix the problem? How expensive was the room and how likely are you to return to the hotel or another in the chain?

If you're an elite member of a better hotel chain's frequent guest program, your night was truly horrendous and the management bungled any efforts to correct the problem, you've got some pull.

If you spent a single night at an independently owned fleabag by the interstate . . . maybe not so much.

Assuming the hotel chain actually cares about your future business, the key to winning a free night after a bad experience is how you handle the disaster. For example:

• Try to get the problem(s) resolved before demanding compensation. Involve the hotel's manager if calls to the front desk aren't producing results.

• Be reasonable. A dripping faucet is not worth making a federal case. If your toilet wouldn't flush and the hotel wouldn't move you to a different room, that's a different matter.

• Those "comment cards" are useless. If the issue isn't resolved, write a clear, concise letter to the hotel chain's CEO outlining the problems you had.

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