Credit Card Debt and Negotiating with Creditors

[g unit]

Hi, I've read a couple of posts on here regarding credit card debt but thought I would start another one since no one has really mentioned this particular topic before.

Has anyone with high credit card debt been able to negotiate a repayment schedule directly with either VISA or Mastercard before going the bankruptcy route?? I'm wondering if credit card companies are willing to lower their interest rate on your outstanding balance if you tell them your hooped for cash and have no option but to claim bankruptcy unless they don't do anything on their part.

Thanks

[Godfuader]

Its usually the collections department who do the negotiations. They tend to be okay with a reduction in principal if you put up a lump sum...or let you setup a repayment like a loan.

[g unit]

I'm not concerned with reducing the principal, just the interest rate. I'm not too familiar with debt consolidation loans, but from the info I got from one source, what they do is cancel your credit cards and set up a repayment plan that fits your income. The drawback of going that route is that it puts a R7 your credit rating for each of the credit cards they cancel, thereby leaving you with shitty credit and making you rebuild it on your own through secured credit cards, etc.


Has anyone on here done a consolidation loan, and if so, can you tell me the impact it had on your credit score, what interest rate they were able to get you and if you would do it again.

Lastly, if anyone has gone the bankruptcy route, I'd appreciate getting any valuable info you may have.

[broken_legs]

Originally posted by g unit
I'm not concerned with reducing the principal, just the interest rate. I'm not too familiar with debt consolidation loans, but from the info I got from one source, what they do is cancel your credit cards and set up a repayment plan that fits your income. The drawback of going that route is that it puts a R7 your credit rating for each of the credit cards they cancel, thereby leaving you with shitty credit and making you rebuild it on your own through secured credit cards, etc.


Has anyone on here done a consolidation loan, and if so, can you tell me the impact it had on your credit score, what interest rate they were able to get you and if you would do it again.

Lastly, if anyone has gone the bankruptcy route, I'd appreciate getting any valuable info you may have.

transfer your balance to one of your other cards that you didn't max out and they will gladly take it at 4-6%.

If you maxed out all of your credit cards apply for a new one and do the balance transfer.

Most cards will give you 6-12 months of low interest for the grace of carrying your balance.

You can pretty much swap between cards every year, or just keep getting new ones. Just dont spend your new credit on frivolous stuff and you should be ok.

[Mibz]

I've got no first-hand experience but have read many recollections where people have done exactly what you want to do. They phone the CC company, talk about their current situation and the CC lowers their interest rate and/or minimum payment. From what I've heard, they're usually quite understanding.

What have you got to lose by phoning?

[Jonel]

^ this, I was in trouble when I got laid off a few months ago but recently got my job back. During that time period I talked to Mosaik MC regarding the situation and they were more than happy to help me with my situation.

[Gabe182]

What are some of your guys minimum payments like?

[HHURICANE1]

You can talk to a credit counseling service and they can renegotiate with the credit card companies before you go the bankruptcy route. They are in the phone book under credit counseling I believe.

[g unit]

thanks for the input. I've done alot of research over the last few days and came up with a few options:

1) try to consolidate all high interest rate credit cards to a low-interest card

2) talk to each creditor personally and see if we can reach an agreement

3) go to alberta credit counselling and get them to do a consolidation order called 'orderly payment of debt' whereby all the unsecured debt is consolidated into one loan bearing an interest rate of 5%, which must be repaid in full within 4 years. This option cancels all your credit cards and forces you to rebuild your credit as your credit bureau shows R7

4) Bankruptcy

[Mibz]

Originally posted by g unit
thanks for the input. I've done alot of research over the last few days and came up with a few options:

1) try to consolidate all high interest rate credit cards to a low-interest card

2) talk to each creditor personally and see if we can reach an agreement

3) go to alberta credit counselling and get them to do a consolidation order called 'orderly payment of debt' whereby all the unsecured debt is consolidated into one loan bearing an interest rate of 5%, which must be repaid in full within 4 years. This option cancels all your credit cards and forces you to rebuild your credit as your credit bureau shows R7

4) Bankruptcy If you can, do #2 and pay off your cards in order from highest APR to lowest. It's the best solution for your credit. You need the income and the discipline though.

[Jonel]

Originally posted by Gabe182
What are some of your guys minimum payments like?

On my Visa, on a limit of $2000 and if it is max I pay $75minimum and on the a $3600 MC card minimum I think was about 275-350?

[Alterac]

My payments are $0.

One of my cards sits at a $0 balance, and the other goes up and down between $50 - $600 a month.

It all gets paid off, and I pay no interest.

I just dont buy things when I dont have the cash on hand to purchase them.