If you are struggling to stay current on your credit card debt, it may be tempting to file for bankruptcy. However, before heading to a Michigan bankruptcy court, it may be in your best interest to work out a new payment plan with the company that holds the debt. As a general rule, credit card companies will work with their customers to make their outstanding balances easier to manage.
Credit card companies can help in multiple ways
Your credit card provider may take a number of steps to help you obtain debt relief such as waiving the interest on your balance for a period of several months. You may also be able to negotiate a permanent lower interest rate or roll missed payments back into your loan to avoid a default. In some cases, a portion of your credit card debt may be forgiven in an effort to make future debt payments more affordable.
What are the odds of a debt settlement?
It’s possible that your credit card company will take less than what it is owed to close your account for good. For instance, if you owe $10,000, it may be possible to make a lump sum payment of $5,000 to get rid of the entire balance. However, it’s worth noting that you will generally need to make that payment within days or weeks of agreeing to do so. Furthermore, a debt settlement might have an adverse impact on your credit score.
If you don’t think that you can make a credit card payment on time, call your lender immediately to determine if assistance is available. At a minimum, it may be possible to waive any penalties, late fees or interest that may accumulate until you can get current on your account.
