Living underneath the weight of credit card debt is the norm for many households in the United States. In some cases in Pennsylvania, the debt may be so great that a person considers filing for Chapter 13 bankruptcy, where they reorganize their debts and can save their homes from foreclosure. However, this may be reversed simply through the art of negotiation. A few tips may help a person to effectively negotiate with credit card companies in order to more easily pay off outstanding debt.
An American household has more than $15,000 in debt on average. However, negotiations could help more consumers to decrease what they owe and even produce a more agreeable payment plan. This is because credit card businesses have a huge incentive to cooperate with consumers so that they get as much of the money owed to them as possible. After all, since most debt on credit cards is not secured, these companies cannot take a person's vehicle or house to make up for nonpayment.
When talking with a credit card company, it helps to provide detailed reasons for why a person is financially in trouble. This could be due to the loss of a job or even health problems. Then, it makes sense to calculate what monthly payment one is able to absorb each month and recommend this amount to the credit card company. If it is possible to pay one lump-sum amount toward the outstanding debt, it may be worth doing this and then asking that the remainder of what is owed be discharged.
It is wise to contact a company's collections department directly when trying to negotiate with a credit card company. In addition, once an agreement has been reached with the company, this needs to be recorded in writing to avoid future disagreements. For those in Pennsylvania who are not able to make their debt more manageable through negotiations or by aggressively making payments, they may wish to consider Chapter 13 bankruptcy to get out of debt and get back on track financially.
Source: Fox Business, "How to Negotiate Your Credit Card Debt", Donna Fuscaldo, May 2, 2014