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Different Types Of Credit Card Debt Negotiation & Overview Of Each

January 30, 2012

Credit Card Debt Negotiation

credit card debt negotiation

Credit card debt negotiation can be done through a variety of methods, all of which have the goal of making your life more debt free or completely debt free! Below are the major types of credit card debt negotiation methods, which will allow you to familarize yourself with the benefits as well as which one best fits what you are looking for.

Methods of Credit Card Debt Negotiation

First off, there has been a lot of speculation as to whether credit card debt negotiation damages you credit score, which the answer is yes unfortunately most likely, as negotiation doesn’t look that great according to credit bureau standards. During the negotiation process, you will most likely experience a lot less freedom when it comes the your line of credit for obvious reasons. The good thing though is that using the methods below you will either be out of debt completely or will have the ability to pay your monthly payments. Below are methods that you can utilize:

Self Negotation

If you didn’t know, you can actually try to negotiate debt on your credit card with your credit card companies. This negotiation will include trying to get a lower interest rate, which will allow you to pay more towards the prinical debt amount, and less towards just covering your interest fees. As a bi-product, often times the late fees are stopped as well. The best way to negotiate with credit card companies is to present to them what your budget looks like and how a lower payment would greatly help you, which will help them because they want to get paid. Now this can also apply to someone becoming unemployed, which credit card companies often times tend to have a soft side for and can offer forbearance, which is essentially a designated period of time in which you do not have to pay your credit card payments, in which the timeframe is negotiated depending on various factors. If in fact your debt is now with a credit agency and no longer with your original creditor, you can still try self credit card debt negotiation.

Settlement

Credit card settlement, which is another form of do it yourself credit card debt negotiation in which the person in debt presents the idea of settling their debt with one or two lump payments, in which the credit card company may or may not go for right away. If you can afford to do this and they allow you to do so, then by all means do it, but they may require you to show some good faith, especially for those who have not made payments in a few months, which they may want you to make a certain amount on on-time payments first. If your credit card company has offered you a settlement letter, have that ready when you call as well as all other information pertaining to your account, your most recent bill as along with how much you can afford to pay them. Alos it is a good call to let them tell you the amount that they are willing to settle for, and then negotating from there as you may offer to much if you speak first.

Credit Card Debt Negotiation Company

You can also employ an company who specializes in credit card negotiation, which basically they take the job of doing the grunt work of the negotation process, leaving you out of the equation, but like it was said above you must continue making your payments until the you are notified by the negotiation company that the process is finished. It is rumored that it is cheap to use this method, but often times it can be very expensive. The possibility also poses itself that if you end up owing the credit card debt negotation company, then you will end up needing to pay them as well as interest on those payments. This method is best for those who are knee deep in debt and need assistance from professionals, which when doing business with a company that offers their negotiation serivces, they will also offer debt counseling which can help one immensely and especially avoid the situation that they are in from happening again.

If you look at the fact that $10,000 in debt can take one as much as 25 years to pay off if one pays only the minimum, credit card debt negotation can allow you to get out of debt quicker as well as save you tons of money, which as you can tell both in the short run as well as the long run.

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