Debt Negotiation: Talk Down Your Credit Card Debt

Credit card debt is the number one form of debt in the country, and every day more and more Americans are finding themselves in deeper and deeper with credit card companies. When the payments seem high, and the interest rates are beyond comprehension, you may be looking for relief. Debt negotiation can relieve the situation and allow you to fight for your hard-earned money and still make your creditors happy.

Debt negotiation is a form of debt management that allows the debtor or a debtor representative to negotiate the loan terms with the credit card company to reach a settlement amount and form a pay-off or reduce the interest rate, thus bringing relief to the debtor. This means a way to pay off your credit card balance while saving a little money or bringing relief to your monthly payments and shortening the amount of time it takes to pay off your balance by decreasing the interest rate.

The first step to successful debt negotiation is to know as much about each of your credit card accounts as possible. Pull out all the information for each account you have and make a shortlist of the following information for each account to have readily available when you call. You need to have the account balance, monthly payment, interest rate, creditor, and full creditor contact information. Knowledge is power in this instance, and the more you know about the company and how the company compares to your other accounts, the better the negotiating power you have.

While credit counselors are trained in the art of debt negotiation, and if you are unable to make the calls and negotiation yourself, you can find a credit counselor who offers debt negotiation services and have them make the calls for you. With that said, with a bit of courage and some confidence, you can negotiate your own account and contracts with great success and a few tips.

Tip #1: The most important thing to remember when negotiating with your creditors is that you MUST be speaking with someone authorized to make changes to your account; otherwise, you are wasting your time. Only certain supervisors are authorized to offer settlements and make changes to accounts, and most people you talk to are only there for customer service and billing calls. Ask for a supervisor or account specialist before starting your pitch.

Tip #2: Put together some pay-off money and know your backup bargaining chips. The best thing you can do is offer a pay-out or settlement offer. To do this, you need a lump sum that you can pay them to settle the debt if they agree. If you cannot offer this, you need to have the information in front of you to negotiate other conditions like a lower interest rate. For this, you should have other credit card offers and accounts in front of you to offer what other companies are offering you. Many credit card companies would rather meet a lower interest rate than lose your business.

Tip #3: Don’t take no for an answer. This means that if they don’t go for a settlement or payout option, don’t give up. Instead, ask for a lower interest rate or a loyalty credit to your balance. If they resist lowering your interest rate, tell them you have other offers to consider transferring your balance to offer a lower interest rate. They will often at least match it, if not beat it. Even if your account is the default, they would rather you stay with them and pay it than close the account and leave their company.

Debt negotiation can be an excellent tool for lowering your interest rates, monthly payments, or finding a way to pay off credit card debt. These tactics can all bring success when partnered with a confident attitude and understanding of the credit card industry. With a bit of work and negotiation, you can be well on your way to a life without credit card debt.