Credit card debt has the potential to bog down your finances, while also making it difficult to enjoy other aspects of your life.
While there are many ways to eliminate credit card debt, there’s one strategy that individuals often overlook: settlement.
Credit card debt settlement is when the bank agrees to settle your account for less than the full balance due.
If you’re interested in negotiating a settlement, here are three tips to follow:
- Don’t hide: As soon as you realize you’re in over your head, contact your credit card issuer (or issuers) to discuss your situation. You can only hide for so long, as your account will soon be sent to collections.
- Make a strong offer: The stronger your offer the greater chance there is that your credit card company will accept it. For example, if you owe $20,000, don’t make an offer of $1,500. Instead, offer as much as you can and negotiate from there.
- Get the settlement in writing: Don’t do anything until you have the terms and conditions of the settlement agreement in writing. If you neglect to do so, the terms may change at a later date, thus causing you more difficulties.
There is no way to guarantee your success when negotiating with your credit card company, but these tips will give you the confidence needed to take action.
If you run into trouble along the way or learn that settling your debt isn’t the best strategy, turn your attention to other options. For example, you may be able to eliminate some or all your credit card debt by filing for bankruptcy.