5 Steps to Negotiating Your Credit Card Debt

Are you buried in credit card debt and wondering how you’ll ever escape? Have you considered all your options for paying down your debt, but still coming up short?

Rather than beat yourself up another day, there’s something for you to consider: negotiate your credit card debt.

This is exactly what it sounds like. You contact your credit card company with the idea of negotiating your debt, thus allowing you to settle your account for less than what you actually owe.

If this sounds intriguing, here are five steps you should take:

1. Know the Details of Your Debt

You can’t negotiate your credit card debt until you fully understand the finer details of your account.

How much money do you owe? What’s the interest rate? Have you missed payments in the recent past?

The answers to these questions will position you for success.

2. Talk About Your Options

While you may go into the process with the idea of negotiating your credit card debt, your credit card company could have other ideas. These include but are not limited to:

  • Workout agreement
  • Hardship plan
  • Participation in a debt management program

If you’re only interested in settling your credit card debt, let your issuer know this upfront.

3. Understand the Impact

There is more to negotiating your credit card debt than meets the eye. For instance, just because your credit card company agrees doesn’t mean it won’t impact your finances.

If your credit card company reports your debt as settled, you can expect it to have a negative impact on your credit score.

However, if the debt is reported as account closed or paid as agreed, it’s not likely to have any impact on your credit score, which is what you want.

4. Make Contact

You can think about negotiating your credit card debt as much as you want, but until you make contact you can’t expect anything to happen.

Rather than contact your credit card company via email or live chat, do so over the phone. This gives you the opportunity to explain your situation to a live person. Furthermore, if you don’t get in touch with the right person the first time, you can ask them to transfer you to someone who can help.

5. Ask for the Agreement in Writing

If you’re successful negotiating your credit card debt, ask whoever you speak with to provide you with a written agreement. It doesn’t matter if they do so via email or snail mail, you need a copy for your records.

Simply relying on a verbal agreement is not enough, as mistakes and oversights can and do happen.

Final Thoughts

If you’re able to payoff your credit card debt in full, do so as quickly as possible. From there, implement a strategy for avoiding the same type of trouble in the future.

However, if you don’t have the ability to do so, don’t hesitate to negotiate your credit card debt. This is often the best way to escape your debt in a timely manner.