Cash is king, that is what we were all taught growing up. In my grand-parents generation, if you did not have the money in the bank or your wallet to buy something you did not. The thought of paying for your groceries or a meal out at a restaurant on credit was unheard of. Oh how times have changed. The average American has less than $40 cash on them at all times. However, we all seem to have that Mastercard or Visa with a nice large line of credit, which does not need to be paid off right away. This why so many people are facing massive charge card bills. So what do you do when you can’t pay your bills? Bankrutpcy is often an option, but you can only file once every 8 years, and it does have a negative connotation to some people. If you are not ready to take the plunge, then you may want to try to settle your debt with the bank for less then you owe.
It should be noted that in a 2017 survey conducted by CreditCards.com found that most who asked for better credit card terms got them. That includes 69% of those who asked their issuer for an interest rate reduction received it, and 82 percent were able to get their annual fee waived or reduced. Debt negotiation starts with having an attorney or you talking to your current credit providers. The first way to reduce the amount you will have to pay is by requesting to lower the interest rate (the “APR”) on your current cards. Essentially, the negotiation is about asking the financing company for help in clearing off your credit card debt.
However, if the bank isn’t willing to reduce your APR, you may want to talk about having a stay put in place on your use of the credit card, which also would freeze the interest rate for a period of a few months while you try to pay the balance down. You can also ask to have part of the total debt from interest waived if you are able to provide a lump sum payment from a third party to show you will not be able to continue to make payments, but rather you are trying to help mitigate the financial damage to both yourself and the financing company.
When talking to the negotiator for the bank it is important to explain why you will not be able to pay your bill in full and for how long. If your situation is only temporary, you should let them know that and why. Often times, you can get a short break or even a forbearance from making payments for 3 – 6 months. If your situation does not seem like it will get better anytime soon, make a sensible debt settlement offer with reasonable payments that you can stick to over time.
So, don’t hesitate to ask for assistance. It is surely an option available for all. If you are unable to get this done on your own, you can always speak to a debt relief attorney to learn what other options you have.
