Debt Consolidation – Can You Negotiate with Your Credit Card Company?Written by Charles Essmeier
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woes if they’re receiving payment on time. On other hand, if you’re late on your payments, especially if you’re more than three months behind, you may have some negotiating leverage. That leverage comes with a few strings attached, however. You may be able to negotiate a lump-sum settlement for your outstanding balance, where credit card company accepts a portion of your debt and writes off rest. They’re often willing to do this instead of turning your debt over to a collection agency, as it’s cheaper just to settle. The settlement amount will vary, depending on your interest rate, your balance and your payment history. This type of settlement comes with a couple of problems of its own, though. What if you don’t have money to settle all at once? If you can’t pay your bills on time, you probably don’t have cash to settle at once. Additionally, amount of your debt that gets written off will show up on your credit report as bad debt, and that will stay there for seven years.
Your credit card company may or may not be willing to work out a payment plan, but it costs you nothing to ask them, and negotiating a settlement with them may be cheaper for you than if you consult with a debt consolidation firm. If your credit card debt is substantial and you just can’t make payments, it’s worth a try.
©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation and credit counseling, and StructuredSettlementHelp.com, a site devoted to information regarding structured settlements.
| | Debt Consolidation – Watch out for Payday LoansWritten by Charles Essmeier
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into a nightmare. Many borrowers are relatively low paid blue-collar workers who live from paycheck to paycheck. Someone who is a “bit short” this week may also find themselves short again on their next payday. If they fail to pay back payday loan, interest continues to accrue and additional penalties, such as returned check fees, may apply. It is quite common to see loans of $300 or so turn into debts of several thousand dollars, especially if borrower compounds problem by borrowing funds from a second payday loan store to pay loan from first one.
Several states have already passed laws capping interest rates that may be charged on payday loans. Others will undoubtedly follow. A good alternative to payday loan would be to take a cash advance on a credit card. There is usually a fee associated with a cash advance, but annual interest rate, combined with fee, is still a lot cheaper than a loan at 400%. Anyone who is considering taking out a payday loan should read terms carefully. Otherwise, that “loan until payday” could be there to haunt you for a long time.
©Copyright 2005 by Retro Marketing. Charles Essmeier is the owner of Retro Marketing, a firm devoted to informational Websites, including End-Your-Debt.com, a site devoted to debt consolidation and credit counseling, and StructuredSettlementHelp.com, a site devoted to information regarding structured settlements.
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