Debt Consolidation Information

Debt Consolidation - Can You Negotiate with Your Credit Card Company?


The average American household has nearly $10,000 in credit card debt, and many people are only able to make the minimum payment of 2% of the balance. Even 2% is $200, and by paying the minimum payment, you could be paying on the balance for decades before you finally pay it off. Since new legislation will make it more difficult to file for bankruptcy, it may occur to savvy debtors to try to negotiate a better deal with their credit card company in order to make it easier to pay off the balance. Is this possible?

It might be possible, depending on your credit history, interest rate, and current balance. Your best bet, especially if you have a history of paying on time, is to simply call your credit card company and ask if they will lower your interest rate. They might, especially if you tell them that you got a better offer from another bank. If you have a history of paying late, however, they probably will not be willing to lower your interest rate. That's unfortunate, since paying late has probably prompted the credit card company to raise your interest rate in the first place. Still, it's worth a phone call; you may get lucky.

If you've been paying your bills on time, asking for a lower interest rate may be the only option available to you. The credit card companies aren't going to be too sympathetic to your financial woes if they're receiving payment on time. On the other hand, if you're late on your payments, especially if you're more than three months behind, you may have some negotiating leverage. That leverage comes with a few strings attached, however. You may be able to negotiate a lump-sum settlement for your outstanding balance, where the credit card company accepts a portion of your debt and writes off the rest. They're often willing to do this instead of turning your debt over to a collection agency, as it's cheaper just to settle. The settlement amount will vary, depending on your interest rate, your balance and your payment history. This type of settlement comes with a couple of problems of its own, though. What if you don't have the money to settle all at once? If you can't pay your bills on time, you probably don't have the cash to settle at once. Additionally, the amount of your debt that gets written off will show up on your credit report as bad debt, and that will stay there for seven years.

Your credit card company may or may not be willing to work out a payment plan, but it costs you nothing to ask them, and negotiating a settlement with them may be cheaper for you than if you consult with a debt consolidation firm. If your credit card debt is substantial and you just can't make the payments, it's worth a try.

©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation and credit counseling, and StructuredSettlementHelp.com, a site devoted to information regarding structured settlements.


MORE RESOURCES:


Debt consolidation loans – Solving burden of debts
FPRD (press release) (blog)
Debt consolidation loans are the ones which are there to help the individuals which are suffering from the pressure of the mounting debts. ...



Debt Consolidation Becomes Simpler in Burnaby
Online PR News (press release)
To make individuals debt free, certain debt consolidation agencies are making efforts in Burnaby, BC and Consumer Credit Counselling is one such progressive ...

and more »


PBS (blog)

Government-Run Debt Consolidation Programs Don't Exist
Loans and Credit
If you see an Internet ad promising you an Obama free debt consolidation program, don't click. The odds are great that a traditional debt settlement or ...
Light At The End Of Unsecured Debt Tunnel - Free Credit Card Debt ...TMCnet
The Inception of New Debt Relief Programs Helps Consumers Get Out of Credit ...Marketwire (press release)
Debt Resolution Company Settles $114 Million in Debt in First QuarterPR Web (press release)
I-Newswire.com (press release)
all 33 news articles »


Live-PR.com (press release)

Cheap Debt Consolidation
Live-PR.com (press release)
Resort to debt consolidation when your bank card funds metamorphose into unmanageable. A very common method through which one can procure debt consolidation ...

and more »



Washington Post

FTC rules take aim at debt-relief industry
Washington Post
These borrowers cannot afford a debt-consolidation plan but do not qualify for bankruptcy, Leuthold said. The new rules prohibit companies from charging any ...

and more »



How Do Government Debt Consolidation Loans Work
US Money Talk News
The rising cost of getting an education and the declining state of the economy has ...



The Guardian

Debt consolidation may help as lawmakers call on Fed to look at rate increases
Debt Consolidation Connection
Consumers who are trying to get lower payments may consider debt consolidation, which can lead to paying less interest over time.
The "unusually uncertain" economySalon

all 4,304 news articles »

Google News

home | site map
© 2006