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How Should I Negotiate A Money Settlement Offer For Credit Card Debt?

Author:  Staff Writer Amy

You can easily acquire some credit card debt. But to get out of it always requires a lot of struggle. These days there are a number of debt settlement companies who claim to erase your credit card debts by paying pennies on the dollar. Though these companies may manage a successful credit card debt settlement by negotiating with your creditor, often the success fees they receive from you is hefty. Many people feel it secured to hire a professional debt settlement company while negotiating their credit card debts, however, this is something you can do yourself.

Instructions

Stop making your card payments. This may hurt your credit score but it is significant for a successful debt settlement. Creditors will never agree for a debt settlement agreement if you are a normal payer. They will only come for a negotiation if they believe that you are no longer able to pay your debt. The most suitable time for approaching a debt settlement is 3 to 6 months after stopping your payments.

Make a settlement offer to your credit card company and send it via registered post. You should mention in your settlement offer a one time lump sum payment that your are ready to pay to settle your credit card debt. Often creditors are more willing to receive a one-time lump sum amount than getting a sequence of monthly debt payments. However, this lump sum amount may range between 30%-60% of your original balance.

Obtain the written debt settlement agreement before you make any payment. If you and the representative of the credit card company have come down to an understanding, make sure you have it on paper. The written agreement must clearly specify the amount of your debt payment. Check out whether it is mentioned in the agreement that the lump sum debt payment will settle the credit card debt for the entire outstanding balance.

Now you can send your debt payment for settling your credit card debt. However, make sure you have sent via money order or check. Never provide your creditors access to your bank account, as they may come to know what balance you maintain there.

Thanks to Amy for this article!

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