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January 22nd, 2009

Price Haggling: Not Just for Garage Sales

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In the US, at most stores the price asked is the price you pay; haggling is a lost art, except perhaps at flea markets and garage sales — and, of course, when buying a home.

But with wallets pinched tight these days, the lost art of haggling for other goods and services is making a comeback. We recently noted that tenants are successfully negotiating rents, for example.

But while most consumers wouldn’t even think of asking their cable company for a break, some are — and are getting results:

Frustrated with his hefty and mounting monthly bill for TV, Internet and phone service, Alan Weinkrantz of San Antonio decided to call his provider, AT&T, shortly before Christmas to ask for a discount.

“Times are tough, and I don’t think I can keep paying these rates,” Mr. Weinkrantz says he told an AT&T representative. A communications-industry consultant who keeps a close eye on the space, Mr. Weinkrantz says he hoped for a reduction of about 10% to his $159 monthly bill.

To his surprise, AT&T reduced his bill to $94 a month, a drop of almost 50%, for a one-year period. “I was very surprised,” Mr. Weinkrantz says. An AT&T spokesman declined to comment on the specific bill but said that “we work hard to give our customers the services they need at the best price.”

As they should, since Mr. Weinkrantz could get these services from other providers. It’s called competition, something a lot of larger companies haven’t had to think about for quite some time. Consumer Reports did a nationwide survey recently which showed that

[M]ore than 90 percent of those who haggled over furniture, electronics and appliances, floor and demonstration models, and medical bills scored a lower price on at least one purchase during the past three years.

Asked about their biggest coup, most successful bargainers said they’d saved $50 or more. In the case of cell-phone deals and medical fees, more than one-fourth saved at least $100.

Of course, it helps to know how to bargain for a better price; WikiHow has a really good how-to article on how to haggle.

Americans who have traveled abroad know that haggling is so ingrained in some cultures that merchants there might even be insulted if you don’t. To them, that’s how business is done. (That doesn’t mean he still won’t try to overcharge you.) If you’re lucky enough to be heading overseas, here are some general rules for that situation.

What you have got to lose? The worst that can happen is that they’ll just say “No” — and in most cases, you do have alternatives.

Have you tried haggling? Share your success stories, and tips, in the comments.

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About the HSH Blog

HSH.com's daily blog focuses on the latest developments in the mortgage and housing markets. Our mission is to relate how changes in mortgage rates and housing policy, as well as the latest financial news, impacts consumers, homebuyers and industry insiders alike. Our 30-plus years of experience in the mortgage industry gives us an edge as we break down the latest changes in an ever-changing market.

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Tim Manni

Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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