While it may seem a bit overwhelming at first, you can negotiate a credit card settlement yourself. Before we get started, however, you need to know that this process can take a lot of time and energy. With that being said, savvy consumers can often eliminate unsecured debt, free up additional spending money, and even avoid bankruptcy all on their own without having to pay a debt consolidation company a dime. If you are already behind on your bills, you really have nothing to lose. Here is one way to negotiate a credit card settlement yourself.
How to Negotiate a Credit Card Settlement Yourself
Start at the Beginning
Before you can even get started, you have to know where you stand. Take a few minutes and find all of your current monthly bills. You will need to know how far behind, or how many payments you have missed, for each company that you owe money to. Many people will find it helpful to organize this information into separate lists. This will ensure that you have the appropriate information at your fingertips when you start negotiating.
Determine Your Expense Budget
After you have determined how much money you owe, you need to figure out how much you can afford to pay each month. To do this, it is crucial that you create a written budget. It is also important that you do your best to be conservative. It is way too easy to think you can live on next to nothing each month. In addition to your normal, routine expenses, you need to budget in the fun stuff as well. You will spend money so you might as well go ahead and budget for it.
Establish Your Expectations
While it is certainly true that you will want the best possible deal as you negotiate a credit card settlement yourself, you need to set realistic expectations. Settling for 20 cents on the dollar is not realistic (although it does happen). Paying 60 cents for every dollar of debt is a much more likely scenario.
Know Your Rights
Many credit card companies are ruthless; plain and simple. They will do anything in their power, even violate your rights, to get you to pay your debt. As such, it is always a good idea to visit the official website of the Federal Trade Commission. Spend a few minutes browsing this site so that you will have a better understanding of what they can, and cannot, do or say. Always remember that even when you negotiate a credit card settlement yourself, you have rights.
Make the Call
This is perhaps the most nerve-wracking step you will have to do. Picking up the phone is, however, half the battle. Pick one of your debts and call them. Be polite and ask to speak to a supervisor. The initial rep will, of course, try and get you to speak with them. Be persistent and ask for someone who can actually make decisions. Once you have the supervisor start slowly and explain that you cannot afford to pay all of your bills and that the companies that agree to work with you will get paid before those that won’t.
Start your offer relatively low, but do not insult them. It is also important to give yourself a bit a wiggle room in case they produce a counteroffer.
Get it in Writing
If you do not get it in writing, it did not happen. Regardless of any assurances provided by the supervisor, you must get the agreement in writing. In every case, you will need proof so that if they decide not to honor the new amount you will have evidence to support your claim to a reduce amount. If they do provide a settlement in writing, you need to pay the agreed amount within the established timeline.
While it is certainly a tedious, and time consuming process, you can actually negotiate a credit card settlement yourself.