How to Negotiate Credit Card Payments Without a Credit Relief Company

Many Americans have fallen behind on credit card payments at one time or another, often because of job loss, financial strain or irresponsible card usage. If you find yourself behind on credit card payments and aren't sure what to do, negotiating with your creditors might be an option for you. In many cases, creditors are willing to accept a settlement on debts owed if it means that they'll get some money. In addition, you might be able to renegotiate the terms of your credit card, such as the minimum payment or interest rate.

Instructions

1

According to an article on MSN Money.com, you should first determine how much you can pay the credit card company; then offer less than that. Although some credit card companies are unwavering about minimum payments, some might be likely to work with you if you've fallen behind excessively and if you can pay them in a lump sum.

For example, if you owe $1000 to a credit card company and are two or three months behind in your payment, you might offer to pay the company two payments of $300 each in exchange for a complete settlement of the loan. The company might decline that offer but counter with an offer to take two payments of $350 or $400 each, for example, which still gives you a significant discount on the total.

You can also attempt to negotiate the interest rate or minimum payments due on the card with the creditor. Be reasonable, and let them know that this might be the only way that you'll be able to afford to pay off the debt.

2

Call them at the end of the month. Many collection agencies and creditors have to meet monthly quotas, so they might be more likely to cut you a deal at the end of the month. Don't give them a sob story, though. Your situation isn't going to make them cancel the debt, no matter the circumstances. Stay composed and professional during negotiation.

3

Once the settlement has been reached, tell them that you'll pay it only if they remove all negative information from your credit report. MSN Money suggests that at the very minimum, the creditor should list the account as "paid-in-full" as opposed to "paid-in-settlement." Insist that this is done; you are in control of the situation and can decide whether or not to pay them.

4

Get an agreement in writing before making any payment. Ask the credit card company to fax or mail you a copy of the agreement before you make a payment. If they've agreed to wipe your credit report clean, the agreement should indicate that. The agreement also should show the agreed-upon settlement amount, and the date by which the settlement is due in order to remain valid.

If you can, also record the phone coversations between you and the creditor. If you pay the settlement and they do not keep their end of the bargain, you can use this information in court.

5

Pay by check, if you can. When you issue a check to a credit card company once a settlement has been reached, MSN Money recommends writing "cashing this check constitues full payment on the account" on the back of the check. This also can be used in court if the creditor doesn't keep up its end of the bargain.