How Do I Get My Credit Card Company to Forgive Half My Balance?

The weight of overdue and rapidly climbing credit card balances can overwhelm even the strongest constitution. When a credit card becomes overdue, late payment penalties and escalating interest can make a bill once difficult to pay, now impossible. While the outlook may appear bleak, there is something you can do: have the bill reduced. Most credit card companies will work with a financially burdened customer, so the answer to "How do I get my credit card company to forgive half my balance" becomes "Just Ask!"

Evaluate

Evaluate the situation. Determine whether a credit card company will consider you a serious candidate for balance reduction. Create a plan for repaying the remaining balance. Get all these things before picking up the telephone and increase your chance of success.

Credit card companies base their decision on your request to settle on numerous factors. The most important of these are the date you made your last payment, the balance on the account and your current financial situation. An account must be in default before the credit card company will consider settling. The general rule is a minimum of 90 days. Your current financial situation must indicate that you are not capable of paying the entire balance. For example, if your account is 90 days past due, you owe $4,000 and are unemployed.

Order a copy of your credit report from credit reporting agencies. This is especially important when trying to settle with multiple credit card firms. You are entitled to one free credit report each year from each of the major reporting firms (Equifax, Experian and TransUnion). All three are available through websites, such as FreeCreditReport. List every detail about every credit card, including the date of last payment.

Create a monthly financial plan and calculate how much you can commit per month to a repayment plan on the remaining balance.

Negotiate

Negotiating with a credit card company is a process. Do not expect to accomplish everything in one conversation. Start with a phone call to the customer service department of the credit card company. Present yourself in a professional manner; explain your situation clearly, logically, and unemotionally. Remember that while your purpose is to reduce your balance, the company's is to collect on the money you owe.

Always negotiate fairly. Do not expect to have the entire balance forgiven and do not suggest a settlement of less than 50 percent of the total amount due. Credit card companies do not have to negotiate with you, so be reasonable in your expectations.

Follow up the phone conversation by sending a debt negotiation letter by certified, return receipt mail. If the company denied your offer, restate your situation and the offer you made via the phone. If you are still negotiating, state the terms you talked about, and agree to them or make another settlement offer. Call again after receiving the return receipt. Repeat this process until negotiations are complete.

Any final agreement should always be in writing.

Considerations

While the prospect of speaking directly with a representative of the credit card company can be daunting, this is something you can accomplish yourself. There is no need to pay a debt settlement company or anyone else to make arrangements on your behalf.

Settling with a credit card company can have a negative impact on your credit rating. An idea is to include in your agreement a promise that in return for your full and on-time payment of the remaining balance, the credit card company marks your account as "Paid in full."