How to Negotiate Lower Payment for Credit Card Payoff

Your credit card company won't talk to you about lowering your debt through a settlement until you have fallen several months behind. Finance charges and late fees will continue to mount as your account becomes more delinquent, and you'll be subjected to constant collection calls. However, after about four months the card companies generally will entertain settlement offers. After six months, card companies usually give up on trying to collect and will sell your account to a debt collector.

Instructions

1

Draft a letter to your credit card company requesting that you be allowed to settle your debt for less than the full amount owed. Be sure to include your current address and account number. Explain that you no longer can afford to pay the full amount owed and wish to settle. According to a New York Times article published Jan. 2, 2009, some card companies will settle for as little as 20 percent of the balance in a settlement. Make that your initial offer.

2

Address and send the letter to the customer service department when you have fallen about four months behind on your payments.

3

Allow two to three weeks for a response through standard mail. Review the response, which likely will be a counter-offer much higher than your original offer. Follow the instructions in the letter to accept the offer, or write back with a counter-offer.

4

Continue the negotiations through the mail, or speed things up by calling your card company. The company will have placed notes on your file regarding the previous correspondence and can continue the discussions on the phone. Call the customer service number on the back of your card. Your call will be handled there or transferred to the collections department.

5

Accept an offer that you feel is fair, and make a lump sum or series of payments to pay off your account.