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How to Negotiate Credit Card Debt Like a Pro | Financial Planning Tips

How To Negotiate Credit Card Debt Like A Pro

If you’re struggling to keep up with your repayments and you’re falling further behind each month, you might want to know how to negotiate with credit card companies. Instead of paying huge penalty interest charges and overdue fees while you watch your balances get higher, try calling your creditors and discuss your options with them for settling credit card debt as soon as possible.

Credit card companies are surprisingly happy to work with customers to negotiate various aspects of your account. The key to successfully negotiating with your creditors is to know what you want them to help you with, before you make the call – that way you’ll have a much higher success rate.

Here are some of the best ways to negotiate credit card debt and get yourself back on track financially.

He's NOT negotiating like a pro...

He's NOT negotiating like a pro...

Negotiate for Lower Interest Rates

Many credit card customers are surprised to learn they’re paying far more in interest charges than they thought. This can happen if you’ve missed a payment or been late on payments and your lender has applied a penalty interest rate to your account, along with hefty overdue fees.

This can make it much harder to get back on track with your payments, so call your credit card company and discuss your situation with them. Explain that by reducing the amount of interest you’re charged, you’ll be in a much stronger position to repay the outstanding balance more easily. You’ll be surprised how many credit card companies will consider this option.  And if they don’t you might be able to transfer your balances to a zero percent credit card for the time being – just watch and make sure that there isn’t any 0 balance transfer fee associated with the transaction.

Negotiate to Have Fees Waived

If you’ve been stung by late payment fees, over limit fees and other charges that have increased your balance and made it harder for you to keep up, call your creditors once again and ask to negotiate those fees or even have them waived.

Negotiate a Credit Card Debt Settlement Figure

You might find that your credit card debts have spiralled out of your control and you’re no longer able to keep up with the repayments at all. If this has happened to you, you might want to see if your creditor will negotiate a credit card debt settlement figure.

This is where you offer your creditor a lump sum amount of 25%-50% of the total outstanding debt as payment in full for the amount you owe. It might sound strange to offer your credit card company an offer like this, but in reality, the company will understand that it’s better to receive something from you than to risk receiving nothing at all if you file bankruptcy.

Negotiate a Payment Plan

When you’ve reached a credit card debt negotiation agreement with your credit card provider ask for a copy of the agreement in writing. It will show you exactly what the lender has agreed to in an effort to help you with your financial situation.

If this agreement involves reducing the total balance you owe as a lump sum settlement, then you may need to call again to negotiate a payment plan to make sure the amount gets paid. Be realistic about how much you can afford to pay and then stick to your payment amounts to avoid any further problems arising.

Things to Remember Before You Negotiate Credit Card Debt

Remember to be patient and polite, as the person on the end of the phone isn’t personally responsible for your fees. That customer service person is simply doing a job. Besides, you’ll receive a much better reception from the person on the phone if you’re friendly and helpful, as they’ll be more likely to want to help you.

Be aware of what you’re going to offer your creditors before you call. Remember that you are trying to negotiate down so you can clear debt you’ve accrued for good eventually – so remain cool and calm.  After all, they’re only trying to find a way to get their money back from you, so if reducing your interest rates or waiving your fees will help them do that, they’re more likely to help you.  End result is to be eliminating credit card debt once and for all.

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