Credit Card Debt Settlement Sounds Good, but Beware!

If you find yourself unable to pay your credit card debt, it is possible to settle your outstanding balance for less than full value. Credit card companies will routinely take between 20 and 50% of the balance. There are two caveats: you have to be able to pay that amount in cash, and; different creditors will accept different amounts.Some companies are harder to deal with than others. Credit unions will frequently refuse to negotiate on debt. Their belief is that they have no right to negotiate away their member’s money. However, in refusing to negotiate a settlement, they often end up with nothing in return for the investment. Some small banks take an even harder line. Columbia Bank will sue and seek to garnish at the first sign that they won’t get full value back. American Express (Amex) is another company with whom it is hard to strike a deal. Amex typically won’t settle for less than fifty percent of the debt. On the other hand, most major credit card companies will negotiate substantial savings. Most collection agencies will as well.You also have to have a lump sum payment in order to achieve significant results. That can be tough, considering that, most likely, the reason why you are unable to pay your credit card debt is because you don’t have that sort of money in the first place.The last thing to remember is that you, the consumer, can negotiate on your own. You don’t need a professional to do this. If you do hire a professional, you should not have to pay a lot to settle your debt. It simply isn’t that complicated. There is a certain knowledge that a professional brings to the table, but the benefit of that knowledge is not substantial. Further, whatever you do, don’t agree to debt settlement on a contingency basis. That is the greatest rip off of all. You will substantially overpay for the service you get.If you are approached by someone offering you a deal too good to be true, it likely is. Remember, if you can haggle to buy a car, you can negotiate with Chase or Citi bank to settle your debt. If you need a little assistance, pay for that, but don’t overpay. You can also call the Rosenberg Law Group, PLLC for a free consultation.