Are There Any Government Grant Programs to Pay Off Credit Card Debt?

The government isn't going to bail you out on credit card debt. As of 2011 there are no government grants for paying off credit cards. There also are no major nonprofit or private groups offering grants for paying off personal credit card debt. Fortunately, there are other resources available to help you manage excessive debt from credit cards.

Credit Counseling

Nonprofit credit counselors certified by the U.S. Department of Housing and Urban Development offer free initial counseling sessions to discuss options for managing credit card debt. The counselors also offer workshops and classes in financial management. Find a counselor near you by checking the HUD website or seeking a referral from a local charity such as the National Urban League.

Bankruptcy

Bankruptcy is another option provided by the government. Chapter 7 bankruptcy allows you to eliminate all unsecured debt such as credit cards in as little as three months. Individual states set income limits for filing for Chapter 7 and usually only people with modest incomes qualify. Others can choose Chapter 13, which also eliminates credit card debt but requires a payment plan lasting three to five years.

Social Services

County social services agencies won't pay your credit card bills but you may qualify for other services if you are struggling financially. For example, you may qualify for food stamps or discounted public housing. The money you save on food and shelter could be used to pay down some of your credit card debt. Grants for necessities may be available from other public and private organizations as well.

Settlement

Debt settlement isn't a grant and isn't available through the government. However, you can negotiate directly with your credit card company to pay your credit card debt for less than the full balance. Settlements generally range from 20 to 70 percent of the balance. A significant discount through settlement has some of the same benefits as a grant, although you may be taxed by the Internal Revenue Service on the amount forgiven.