How to Stop Credit Card Debt Legally

Living with credit card debt causes financial stress and worry, especially in tough economic times. High monthly payments can create budgeting shortfalls, and high interest rates mean it may take you 20 years or more to pay off an item you purchase today. If you're over your head in credit card debt and can't obtain a balance transfer or consolidation loan, there are options for dealing with or eliminating your debt.

Instructions

1

Contact your credit card company, using the telephone number provided on your statement, and inquire about a hardship program. You may be granted a short-term decrease in your interest rate or payment amount while leaving your card open. Other hardship programs decrease your interest and payment until you pay the balance off, but close your account.

2

Stop paying your credit card bills if you aren't eligible for a hardship program. Some credit card companies will not negotiate until you are several months behind on your payments.

3

Set aside money each month so that you can offer a lump-sum settlement amount to your creditor. Creditors may agree to settle debts for a fraction of the outstanding balance.

4

Call your creditors at least monthly, starting with your first missed payment. Perseverance often pays off, so if you are rejected, don't give up.

5

Keep thorough notes of all contacts with your credit card company. Write down the name of every person you talk to, the date and time you called, what you requested or offered, and what the response was.

6

Require a written letter detailing the terms of your settlement before you make any payments. Keep this letter on file with a record of your payment. Collection agencies may try to collect on the forgiven portion of a settled debt years after the settlement date.