Tips for Negotiating Credit Card Debt Yourself

Negotiating credit card debt yourself is challenging, but it can be done and is a viable credit card debt solution for some. As long as you educate yourself and prepare for what might be a difficult round of back and forth negotiation that lies ahead, you can win yourself an agreement that suits you.

In order to be successful, you will first need to devise a viable plan or attack, learn about the options available to you, and what would be a realistic result when it comes to dealing with debt troubles on your own.

Establishing Contact with Your Creditors

If you have not yet written a letter to your credit card company outlining your situation, that should be your first priority. But before you do, you will need to determine what your goals and then clearly and concisely set them forth in the letter.

Do you want to:

• Reduce your interest rates?
• Negotiate a longer-term payment plan?
• Negotiate a debt settlement agreement?

Reducing interest rates may be a achievable with a simple phone call. On the other hand, if your goal is to carry through a debt settlement (where you pay less than the total balance of the debt) on your own, you will have to be prepared for formal written back and forth negotiations with the creditor.

It may be best to start trying to negotiate a credit card debt settlement after you have already fallen behind on your monthly payments. At this stage the creditor should begin to understand your plight, the fact that you are really struggling to meet your obligations, and should be much more open to negotiating a reasonable settlement.

The credit card company does not want to risk having you declare bankruptcy and possibly getting the entire debt discharged.

Before you get in touch with the creditor, either by phone or letter, make sure you have your documents in order. Gather up your credit card statements as well as proof of other monthly expenses and your income. These can be instrumental in demonstrating that you have no other option than bankruptcy if you can’t settle the debt in a timely fashion.

Try to deal with someone that in the company that has the authority to negotiate with you and execute a deal should you come to an agreement. You don’t want to get stuck corresponding with a low-level bureaucrat who can do little to help you. If you hit a wall in negotiations, always ask to speak to a superior.

Cons of Negotiating Credit Card Debt Yourself

Of course, there are downsides to trying to negotiate with a credit card company on your own. The biggest of these is that your lack of knowledge of the industry can lead to you failing altogether, in which case you may have to hire a professional and try again or in an extreme financial hardship case, declare bankruptcy. In that sense, there’s a danger that trying on your own could be a waste of money and get you even further into debt.

Another possible downside to doing your own negotiation is the fact that credit card companies often are not as generous with debt relief for individuals as they might be a with well-known credit settlement company.

This is because credit settlement companies work with the credit card companies on the regular basis and have established operating procedures and working relationships. This also means doing it on your own can be a much slower process, and your attempts to contact the credit card company may even get ignored at times.