How to Negotiate Credit Card Debt With a Bank

According to the Internet personal financial resource Financial Web, if you're finding it difficult to pay your credit card debt, it may be a good idea to negotiate a settlement with the credit card company. CreditCards.com points out that a common misconception that the company will drastically reduce your debt if you just ask is not true. You need to have a reason for the credit card company to lower your debt, and you need to show that you're willing to work with the company to pay off as much of your debt as possible.

Instructions

1

Gather your credit card information and review it before you make the phone call to the credit card company. Know how much your balance is, become familiar with your current interest rate, and have the reason you'd like to negotiate your debt ready to present to the representative. The company may ask you to prove the hardship you're claiming, so have hard-copy evidence ready to submit should it be requested. Also have an amount in mind for the final settlement that you feel is fair. Remember that the company will use your amount as a starting point and will want to negotiate up from there.

2

Begin negotiating by asking for all late fees and other penalties to be removed from your account. Since the credit card company is interested primarily in recovering the principal balance and as much of the interest as possible, this may not be a problem.

3

Ask for a reduction in the interest amount that you owe. According to The Washington Post, it's possible that the company will offer you the opportunity to pay back your principal with no interest if you pay back the money in a predetermined period of time. If you can secure a deal that allows you to pay back the principal with no interest, and you can afford the monthly payments, take that deal.

4

Ask the representative if the company would be willing to take a reduction on the principal balance owed. Depending on the nature of the hardship you're claiming, the company may be willing to do this. If you let the company know that your next step could be bankruptcy, it may be more willing to work with you. The company knows that bankruptcy means it may get nothing, and it would like to avoid that.

5

Work with the representative to develop a monthly payment plan that's within your current budget.

6

Ask for the agreement in writing and let the representative know that you'll start making payments as soon as you receive the written agreement.