Can I Negotiate Debt Settlement or Debt Elimination With Credit Card Companies? – Jo


“Dear Steve,

I have $12k of cc debt on 5 cards and I’m behind on 3 of the 5. I’m currently unemployed, picking up odd jobs, and just recently moved to another state while trying to make it but buried with cc debt.

Can I negotiate debt settlement / elimination with cc companies or can you help me with that and how much would it cost?


Dear Jo,

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Well, you could attempt to negotiate for a debt settlement with your credit card companies but I think it would be an absolute waste of time.

Let’s prioritize your situation. The debt that you owe is the symptom of the greater underlying issue, no income. You’ve got to solve that problem first before you do anything else. I’m afraid that contacting the credit card companies and negotiating anything is only going to set you up for ultimate failure. Without any reliable income coming in you will probably make a repayment promise that you will not be able to keep. That will blow up in your face.

Once you do get the income situation under control then I would suggest that you not negotiate with your credit card companies directly for debt settlements. You are not experienced at this, you don’t know the best deals they offer others, professionals do, and you are too emotionally close to this to see it as an outsider.

If you want to try the debt settlement approach then I suggest that you contact a debt settlement company for more information about the particulars like fees and how it would work for you. Click here for debt settlement information.

But I am unconvinced that debt settlement is for you even after you get the income situation under control. Debt settlement seems to work best when you have cash in hand to pay right now to settle your debt for less than you owe. That certainly does not sound like your situation.

If you can only make monthly payments towards settling your debt what is most likely to happen is that the debt settlement company will accumulate your payments until you have enough money saved up to make an offer on one debt first. During this accumulation period your creditors would not receive any funds from you and may sue you for non-payment. The debt settlement company can explain all of this to you.

Let’s tackle this in steps, solve the income issue first and then come back and I’ll help you come up with a game plan on what to do next. Deal?

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Steve Rhode is the Get Out of Debt Guy and has been helping good people with bad debt problems since 1994. You can learn more about Steve, here.
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