Home -- Guide's Table of Contents -- Credit Card Debt Blog -- Credit Card Debt Articles -- Court Summons -- Credit Card Companies -- Debt Counseling -- Debt Services -- Junk Debt Buyers -- Debt Collectors -- Credit Card Debt Consolidation -- Credit Card Debt Settlement -- Credit Repair -- Debt Collection Attorneys -- Contact Us -- Privacy Policy

Chapter 5: Credit Card Debt Settlement

Negotiating Tips for Settling Your Credit Card Debt scroll down

Settling with Credit Card Banks

Your first contact with an original creditor should be calling the customer service department and asking who handles debt settlement.  Then ask that person, “Will you consider an offer to settle.”  An offer may come after you ask that question.  If the offer is too high, begin negotiating.  The first amount is not their bottom line.  The creditor’s representative may be taking notes about your particular circumstances and recording them in a computer file that can be accessed by other reps that you talk later.  You need be consistent with your story.

Some advise waiting for the bank to contact you about settling.  Bud Hibbs, perhaps the most widely accepted consumer debt expert, advises contacting them to settle and being persistent until you get what you want.  Don’t get emotional or angry.  These reps probably have to deal with that all day long.  Just be matter of fact.  They have settled with many others before you.

Do not allow yourself to be pressured to pay over the phone.  Get a written agreement first. Once you have something in writing you can give the bank your bank account information, if they insist on getting paid ASAP.  They are too regulated to take more of your money than agreed to, but never do that with a collection agency.  You can mail a check if it is the credit card bank, but only a money order or bank check if it is a collection agency.  Collection agencies have been known to access account holders’ checking accounts for more “debt settlement” funds, once they receive the first payment in full with the account and routing numbers on the personal check.

If you do not like the offered amount to settle, hang up and call back and speak to another representative.  If you do like the offer, or when you finally like the offer from another rep, get their name, address, and phone number.  You’ll need that information to follow up with a written agreement confirming what you spoke about over the phone.   Be sure to make your credit rating part of the negotiations.  Send everything CRRR (certified mail return receipt requested).

Here is one example of someone who settled over $100K in credit card debt. Follow the whole thread for great advice and to confirm what you are reading here. http://creditboards.com/forums/index.php?showtopic=383818&st=0&gopid=
3598150&. (You must join creditboards.com -at no cost- and use the remember-me option for this link to work.  If you still cannot access this specific page on creditboards, log onto to creditboards as a member, then copy this web address and past it into the address bar at the top of your browser.)

Negotiating Tips for Settling Your Credit Card Debt

• Your money is you biggest negotiating chip.  Do not make your lump-sum payment until you get the terms you are satisfied with IN WRITING.  As Budd Hibbs puts in his book,  THE AMERICAN CREDIT SYSTEM: Guilty Until Proven Innocent  “Your money is your negotiating tool. The longer you have it, the better your chances of getting a fair deal”.
• Short of a written agreement, do not believe anything stated over the phone.
• When negotiating with collection agencies, the end of the month is the best time.  They work on commission and need to make their collection goals for the month as the end of the month approaches.
• Use the higher-authority ploy to get what you want.  For example, you can say you need to check with your spouse or significant other before proceeding, then come back and say after discussing it with them you want a better deal.
• If they pull the higher authority on you, tell them you want to deal directly with their manager.
• There is the pending-doom ploy.  You are about to file for bankruptcy, you're sick family member is about to have expensive medical treatment for which you are uninsured, so they had better take what you are offering.  You are about to lose your job, and so forth.
• A good negotiating tactic is to negotiate more than one thing at the same time.  For example, if they will not come down any further in a lump-sum payment they are willing to offer, you can negotiate a better listing for the settlement on your credit report.
• Try to avoid making the first offer amount to settle.  Instead ask them what they would be willing to setting for.   Then, you can counter for less.
• Never look too eager to settle. Take plenty of time to reach an agreement. Never let it slip that you need to settle the debt to buy a home or car.

Back to Table of Contents --or-- Go to the next page of Chap. 5

Subscribe to our free newsletter for the latest information on how you can protect yourself from debt collectors and collection attorneys. You do not have to suffer at the hands of debt collectors when you cannot pay your credit card debt.

Use these free chapters of the Guide to educate yourself about the realities of credit card debt collection operations, settlement, and relief scams.

Then buy the rest of the book including 85 pages in Chapter 6: Defeating Debt Collectors and Chapter 7: Defeating Court Action for the best strategy and language to effectively communicate in writing with debt collectors and collection attorneys to prevent them from pursuing your debt.