Low Interest Credit Cards

Is your debt mounting? Do you spend more than you have?  Do you turn to that credit card to pay every day expenses that you don’t have the cash for? If you answered yes to any of these questions you are in the same boat as so many other Americans.  Mounting credit card debt is a chronic issue and a hot topic of discussion in the news today.  Many consumers with overwhelming credit card debt believe that bankruptcy is the only remaining option to relieve them of their burdensome debt load.  Bankruptcy is probably not the best option for anyone involved so before considering bankruptcy you might want to consider negotiating payment alternative options with your creditors.  Start by calling your debt holders, tell them about your current situation, and if you’re struggling to make the payments required, inquire about the possibility of “alternative” payment arrangements that might help ease your payment burden in the short term.

The Benefits of Negotiating

The good news is that now is as good a time as any to negotiate with credit card companies to help ease your debt burden.  The pending credit card legislation planned for early 2010 have pushed credit card companies into a state of panic.  The upcoming legislative changes will make credit cards harder to get approved for and terms of payment more strict for card issuers.  This will significantly limit the credit card companies from the ease with which they’ve been allowed to extract fees and charges from cardholders in the past.  Companies may be more willing to negotiate with those that have outstanding debt because they would rather recoup some of the debt than none of it all.  Negotiating card debt may not eliminate this entirely but you might be able to re-negotiate your card balance and reduce it by 50% or more.

Steps to Negotiating

Take an inventory of your debts and attempt to pay the smallest debts first.  Know what you can afford and make efforts to change you’re spending habits if possible to cut out those non-necessities.

• Before you start getting those calls from your creditor, make every effort to pay your minimum balance on your credit card.  This shows your commitment to paying this off the traditional way.
• Create a monthly budget.  Identify how much you can afford to pay each month before contacting your credit card company to discuss negotiating your debt.  Know the fees and charges you are incurring and be able to discuss these with the agent.  Negotiating just the fees and charges alone may make it possible to pay off your actual balance owed.
• Contact your credit card company and explain to them your situation and your intentions.  Ask them what they can do to assist you.
• Always ask to have copies of what you agreed to send to you in the mail. This way you can be sure that what you discussed is actually what is on record in their system.  Call them with any discrepancies in the contract.
• Always notify your credit card company in advance if you will be unable to meet the terms of your agreement.
• Document all of your conversations with agents relating to you’re agreed upon terms.
• If you are unable to come to an agreement with your credit card company you should seek out the assistance of your financial institution or a credit card counseling or debt consolidation company.  These services have people trained in the art of negotiating debt and will do so on your behalf.

This year alone a large percentage of credit card consumers have dropped behind in their payments.  Increasingly, credit cards are being used as one of the only tools people have left to help make ends meet.  For others credit card use is a habit that has become a way of life. Regardless of the rationale, the reality is that credit card debt it is a mounting problem.  If debt is not handled proactively, it can often times lead to bankruptcy.

Negotiating payment options with your creditors is one thing to consider if you’re trying to manage an overwhelming debt load.  Before declaring bankruptcy, it’s at least worth a shot.

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