How to Negotiate with Credit Card Companies as a Bankruptcy Alternative
On bankruptcy-alternatives-information.com we provide information about bankruptcy alternatives. For many people, the least expensive bankruptcy alternative is to contact your creditors and work out a repayment plan.
If you owe $10,000 to three different credit card companies, you could contact them directly (not through a credit counseling company or a bankruptcy attorney or bankruptcy trustee). This strategy has a greater chance of success if you are relatively current with your payments, and if you are paying relatively high interest rates on your debts.
You start by contacting each credit card company and tell them you are considering switching to a competitor's credit card with a lower interest rate. Obviously switching from a 19% per year interest rate to a 10% per year interest rate saves you a considerable amount in interest, and allows you to pay off your cards much quicker with the same monthly payment.
The credit card company may then offer to lower your interest rate if you agree to stay with them, because they do not want to lose a customer.
By talking to your creditors, it may be possible to get a reduce credit card interest rate.
This strategy will not always work. If you have bad credit, or are significantly behind on your payments, they will not lower your interest rate. In fact, the credit card company may increase your interest rate as a way to encourage you to move to another credit card company, so only try this strategy if your credit is in relatively good shape.
If you have good credit, negotiating with your creditors is and obvious alternative to personal bankruptcy.
Posted by Bankruptcy Alternatives Blog
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