What Do You Do If You Cant Pay Those Bills?
So, you have decided that settling your credit card debts on your own is the better path instead of hiring a debt relief company for the purpose.If you have the skills and talents to compete with these professionals when it comes to negotiation, communication and documentation then give it a shot. After all, if a nurse with little background in taxation and the law can single-handedly take on the Internal Revenue Service and win, then so can you where debt relief is concerned.
There are certain things, however, that you must consider when settling credit card debts as a personal endeavor.These top 3 strategies will make sure that you are closer to dealing with those credit card companies head-on.
Make Sure that Your Accounts Are Significantly Delinquent
You might want to negotiate for lower principal amounts on your credit card bills as soon as you cannot pay the minimum monthly payment required or as soon as you feel that you cannot pay your debts due to other financial obligations. Keep in mind, however, that the debt relief process cannot be availed of until and unless your credit card accounts are significantly delinquent.
Wondering how delinquent?Delinquent credit card accounts are written off by creditors once the 180+ days windows has completed. The write-off subsequently devalues the account so much so that third parties can purchase it for as little as 5 percent of its face value.
To prevent this from taking place, the credit card company will be eager to settle the debt through a negotiation process. After all, if they can collect 50 percent of the total debt, it is still way better than the 5 percent they will get from third parties.
Document Everything
The days of verbal agreements holding any value are long gone and especially when it comes to credit card debt settlement.It is your word against the word of the collection agency so there isn’t a clearcut winner in this scenario.
Instead, you should maintain detailed and descriptive records of everything pertaining to the negotiation and settlement of your credit card loans.Send out the letters with accurate and comprehensive information to clearly specified addresses/addressees.After that, file the letters and other forms of communication in a binder that is easily accessible.
If you must make a conversation over the phone, keep descriptive records of it.Document the date, time, the names of the people you spoke with, the contact numbers and the details of the conversation.
Use Mail That Can Be Tracked
Once the settlement has been reached, send your payment through certified mail or any mail that can be tracked. Send the check together with a memo saying that said check is for full payment, if indeed it is, along with a copy of the agreed settlement.Now, you will have pretty good documentation.
Dont forget the specific strategies that you need to use to settle the debt by yourself.Remember the three tips here and you will do just fine in this process.
There are steps that you can carry out. For more strategies on how to fix a bad credit report you should read our articles about what you can do when you cant pay credit card debt
Now, when you are wondering -how can I improve my credit score? - you will know the answer(s)..