How to Settle My American Express Credit Card Account

While debt settlement is becoming an increasingly popular way for consumers to eliminate outstanding debt, each credit card issuer handles debt settlement differently. If you have a delinquent account with American Express and are considering approaching the creditor with an offer for debt settlement, there are several steps you must take to ensure your effort is successful.

Instructions

1

Contact American Express to verify that the creditor is still the account owner. While the charge-off period for most credit card issuers is around six months, American Express may charge off your account as early as 90 days, depending on the type of account. Your account will then be assigned or sold to a third-party collection agency. If the account has been assigned, you may be able to deal directly with American Express. If it has been sold, you may have to deal with the collection agency instead.

2

Calculate your settlement offer. Settlement offers may be as low as 35 percent of the outstanding balance or as high as 75 percent. How much a creditor will accept depends on the amount of the balance owed, how delinquent the account is, the account holder's credit profile and who the credit issuer is. American Express has a reputation for being difficult to negotiate with so it may be best to calculate a range of offers from low to high, with high being the absolute most you can afford to pay. This way, you have a counteroffer prepared if your initial offer is rejected.

3

Draft your settlement proposal. You may choose to contact your creditor via telephone or through registered mail. If you choose to mail your proposal, include your name, account number, the total outstanding balance and the amount of your offer. You may choose to include information related to your financial situation or an explanation of why your account became delinquent. Avoid embellishment and keep it simple. Explain to the creditor why accepting your offer will benefit you both, and ask for a written acceptance if they agree to your terms.

4

If your offer is accepted, then contact the company to make payment arrangements. Payments should be made via money order, certified check or wire transfer. Never give a creditor direct access to your bank account information. Before you make your payment, ask the company to send you a written verification of their acceptance of your offer. This should include the amount the account is being settled for, the payment schedule and how the account will be reported to the credit bureaus.

5

If your offer is rejected, you may choose to make a counteroffer, increasing the amount of your settlement according to your earlier calculations. Draft a second proposal letter, stating the new amount of your offer and reiterating your good faith intention to pay at least a portion of the debt. Again, state your reasons for why accepting the offer will benefit them and request written acceptance of your proposal. If your offer is again rejected, then you may need to wait before contacting the creditor again. Persistence is key.