Get Out of Debt Guy - Steve Rhode

Can I Negotiate a Settlement With My Own Credit Card Companies? – Larry


“Dear Michael,

I have the great deal credit debt – long story – used a number courtesy checks against these credit cards to add monies into company believing I would pay them off. Well that did not happen, so I have been paying monthly and these amounts – never go down due the interest rates.

Instead of using one of these companies – can I deal with these credit card companies myself and negotiate a settlement or plan.

Just curious


Dear Larry,

You not only can work out a settlement with your creditors yourself, it should be the first approach you take. Hiring a company to negotiate settlements should be reserved for the following situations:

1. You hit a wall with your own negotiation efforts with one or more creditors that have a known policy of working directly with debt resolution companies.

2. You have an account that reaches critical stage collection in the courts and would be best served working with an experienced debt defense attorney.

3. You just simply do not have the time, inclination, or intestinal fortitude (personality type) to do all the negotiation.

Number 3 obviously does not apply to you because you are already motivated to deal with the debts without professional intervention.

Number 2 is just smart should a collection lawsuit occur, but if you are a good candidate for settlement, or payment arrangements on your accounts, lawsuits are not likely.

Number 1 can and does happen, but will be situational and likely not something you can predict right out of the gate if you are not behind with payments right now, or only a month or two behind.

I can better help you assess your options with each creditor if I knew the following:

I should point out that settling may not be necessary if your debt could be made more affordable by getting the interest rate reduced. There are ways to get your creditors to play ball with lowering your monthly payments, either temporarily, or for the life of the balance. Depending on how many creditors you have to contend with, and their current policies for payment and interest rate reduction, it can make good sense to get your debts consolidated using a managed plan through an agency like Cambridge Credit Counseling.

I know that most people have an immediate knee jerk to seeking discharge of unsecured debt though chapter 7 bankruptcy. But if you qualify, it can often make more sense than settling, or any other approach. Filing bankruptcy is one of those things that are better done working with an attorney than going the DIY route.

If you post more details about your accounts in a comment below I can offer more feedback geared toward settling and payment arrangements.

Michael Bovee founded CRN, a unique company offering debt negotiation education and services, in 2004. He recently published CRN’s free online debt relief program as a tool to assist you with making informed decisions about dealing with problem debt, while keeping an eye on your future credit needs and goals. Bovee has been contributing articles and free reader feedback on this site for several years.

Michael is a debt industry professional who has volunteered his time to help answer reader questions.

If you have a debt related question you’d like to ask our team, just use the online form.