Money Talks

Credit Card Debt Negotiation

June 25, 2008 – 2:37 am

Credit card debt is really a menace and a lot of people are grappling with it, all around the globe. Credit card debt consolidation and debt consolidation bank loans are well known as ways of reducing and eliminating credit card debt. In all this confusion, credit card debt negotiation is often ignored.

Credit card debt negotiation starts right from your credit cards where you have the most hard-hitting credit card debt. This means credit card debt negotiation has to be taken up with your current credit providers.

Before you misinterpret it, let me clarify that we are not talking about chucking off a portion of your debt through credit card debt negotiation. We are talking primarily about using credit card debt negotiations for getting the APR on your current credit cards reduced to a lower figure. So, credit card debt negotiation is about talking to your current credit card suppliers for informing them about your intention to clear off your credit card debt, and then using your skills (credit card debt negotiation skills) to agree a lower APR rate with them.

Basically, credit card debt negotiation is about asking your current credit card suppliers for co-operation in clearing off your credit card debt. If credit card debt negotiation is successful, it will save money (due to reduction in APR) but it will also save you the hassle that is associated with looking for a new credit card to transfer balances, or finding a bank loan to pay off the cards.

If the credit card debt negotiation with your current credit card supplier doesn’t yield the desired results, you will still have to look for other credit suppliers who can help you in consolidating your credit card debt. Again, you will need your negotiation skills (again, your credit card debt negotiation skills) to get a good deal from them. Alternatively, move away from credit card suppliers, and take out a bank loan instead.

If your credit card debt negotiations work out well, you might be able to get a really low standard APR or you might get a longer than standard term on 0% APR (or you might get both). Interest rates are really the most important things and your credit card debt negotiations should concentrate more on lowering rates and extending “honeymoon” periods than anything else.

A secondary thing to include in your credit card debt negotiation would be the credit limit and other benefits. Here, you are basically trying out the possibility of getting a better credit card as part of your credit card debt negotiation. For people with really bad credit rating, getting an unsecured bank loan or getting another credit card (for balance transfer) is really difficult. In some cases, refinancing a mortgage is the only available option for credit card debt consolidation.

So, in summary, don’t hesitate in going for credit card debt negotiation. You can gain some tidy benefits and improve your financial position, simply by “using your words” and asking what deals are available.

Image: KM