Settling Credit Card Debt

Are you drowning in credit card debt and contemplating credit card debt settlement? Probably you are taking the right step. Many people consider hiring debt relief companies or a debt settlement attorney to settle credit card debt. However, that can be an unwise decision. While it is true that credit card companies can help you to avoid a lot of troubles with their professional services, there are certain disadvantages of hiring such a company.

What are the disadvantages of hiring a debt relief company?

• Debt relief companies are usually very expensive. They would charge you huge fees for their service. Also, some debt settlement companies do not comply with the FTC rules. They often ask you for a hefty upfront fee which is completely illegal.
• A lot of debt relief companies are scams. They would not provide you the services they promise even after taking a lot of money from you.

What should you expect from credit card debt settlement?

With credit card debt settlement, you should be able to save about 30%-40% of the original debt amount. Ideally, the late fees and penalties should be waived. The interest rate should also be reduced.

Steps to settle credit card debt yourself:-

1. When you are having serious trouble with paying your bills, you should immediately contact the creditors with a settlement offer. If you fail to make payments for a considerable period of time then the creditors will ask the debt collection agency to recover the money from you. This often leads to aggressive collection practices and creditor harassment.
2. Avoid speaking to officials who are unsympathetic and rude. You might contact departmental managers or supervisors. They are usually willing to listen to the debtors.
3. Keep the important documents ready while you approach the creditor for settlement. These documents include your recent bills, proof of current income etc. You should clearly specify a settlement figure to the creditor and mention the date within which you can make the payment. The above documents would support your claim.
4. Avoid using profane language during the conversation. This can ruin your chances of settlement and the creditors can even take action against you. Be particularly careful if you are speaking over phone because the calls are usually recorded.
5. Negotiate with the creditors for the settlement amount and waiving of the penalties involved. With an agreement is reached, it should be written down. Remember that verbal agreements have no value at all.

You can successfully settle your credit card debt if you follow the above steps. However, you might face some harassment during the process. So you should visit the FTC website to know your rights as a consumer.