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How to Negotiate with Your Credit Card Agency

January 20th, 2009

credit-cards-negotiate-interest-rate.jpgAre you one of the many consumers that are facing endless phone calls from creditors and final notices being received in the mail? Rest assured that you are not alone; there are thousands of customers unable to pay their monthly minimum payment. What is your best course of action when dealing with this situation? First, contact the lender as soon as possible to learn every option available.

Explain the Situation. When you explain the situation to creditors there are measures that can be taken to ensure that they receive some sort of payment. In this economy, creditors are focused on working with the consumer to recover any amount that is owed on the balance of the account.

There are many options available, such as suspending interest rates for a period of three to six months to allow the debtor to catch up on past due payments, or writing the interest off that has accumulated allowing the consumer to repay the principal. Sometimes the creditor will offer lower monthly payments to ensure that the payments are made, for three to six months to allow the debtor to catch up on payments.

Follow the Repayment Plan. When a repayment plan has been created, it’s important to actually follow through with it and ensure that all payments are made, on time and in full. When you are negotiating your terms with the credit card company it is important to know that these terms can be made void if payments from the debtor to the credit card company are received late or missed altogether.

Ask for A Settlement. Credit card companies are offering settlements to many customers that appear unlikely to repay the entire balance. Sometimes this settlement can be up to fifty percent less than your entire debt. This settlement can be arranged to stop accumulating interest until it has been paid in full. Keep in mind that a settlement may affect the credit rating negatively, so the decision should not be made lightly.

Use Your Positive Credit History. Use your history of prompt payments and the past payments in which the card has been paid in full to gain merit with the credit card company. This positive history can be used to show your good judgment and behavior in the past, which may cause the credit card company to be more receptive to striking a deal. Explain the importance of your credit rating and demonstrate that you are willing to do everything that you can to preserve your credit rating.


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