An easy way to reduce your credit card debt

You know the feeling. You pick up the latest credit card bill, trying not to look at the balance. You’ll never pay it off. The very thought of it fills you with dread. Fortunately, you may be able to reduce your debt with a single phone call. You can, literally, talk your way out of debt. It’s easier than you think.

Being in debt makes people feel vulnerable. Think of yourself as a dissatisfied customer. That is what you are. Credit card companies want your business. They also want you to keep making monthly payments, rather than default on your debt. In many cases, it’s in their best interest to lower your debt and they know it.

Video: Talk Your Way Out of Credit Card Debt

What to say on the phone

There are two general approaches to this. The first is to play credit card companies against each other. Call up your credit card company and tell them that you’ve received a better offer on another card and that you are thinking of transferring your balance. Remind them that you’ve been a customer for a long time. Then ask if they will match the new offer. More often than not, they will agree. This can save you hundreds of dollars a year in interest charges. Do this on a regular basis and you can save thousands.

Video: Negotiating with Your Credit Card Company is Easy!

The second approach is to negotiate a lower balance by threatening to default on your debt. If you are struggling to pay your bills and are on the verge of bankruptcy, the credit card companies may be open to negotiations. Explain your financial situation and how much you can afford to pay each month. Be honest about it. The credit card company will want to verify your FICO score before agreeing on a payment plan. If they think that you may default, they will be happy to reduce your balance as a preferable alternative.

Some helpful tips on dealing with credit card companies

If you don’t get the answer you were looking for, ask to speak to a supervisor. Do not take a “no” answer from someone who is not authorized to say yes. Whenever you speak to a customer service representative, write down that person’s name. That way if they promise you a lower rate but don’t deliver, you can call back and say that this specific individual quoted a lower rate. Ask for confirmation by e-mail or in a letter. You may need it later as proof of the offer.

Lastly, always be polite to the person you are speaking to. It won’t do you any good to shout at the person on the other end of the phone. It’s not their fault that you’re in debt. They will be less receptive to your requests if you lose your temper.

When should you get the professionals involved?

It’s perfectly possible to negotiate with the credit card companies on your own. There is no shame in it. However, not everyone is comfortable doing it themselves. If you’re worried about it, you can always hire a lawyer or a debt counselor to negotiate on your behalf. These people are professionals who deal with credit card companies every day. They know how things work and are more likely to get good results.

How to deal with credit card fraud

The easiest way to reduce your credit card balance is to challenge any unauthorized transactions. Many people don’t bother to look over their bills. Take the time to read every line. That way if there is any fraud, you will know about it and can challenge it. Simply call up the credit card company and tell them that you do not recognize a transaction. They will send you a short form to fill in.

Most credit card companies offer some level of fraud protection. If you did not authorize a transaction, you will not be held responsible for it. This is true even if you know the person who used your card, as long as you did not give them permission to use it.

Debt counseling agencies

Advantage Credit Counseling Service, Inc.
Pittsburgh, PA 888-511-2227

ByDesign Financial Solutions
Los Angeles, CA
800-750-2227

CCCS Credit Advisors
Boston, MA
800-208-2227

CCCS of Central Ohio, Inc.
Columbus, OH
800-355-2227

CCCS of Greater Denver, Inc.
Denver, CO
866-346-2227

CCCS of Greater Washington, Inc.
Washington, DC
866-346-2227

CCCS of Maryland & Delaware
Baltimore, MD
800-642-2227 

CCCS of North Central West Virginia
Morgantown, WV
800-498-6681

Chestnut Credit Counseling
Chicago, IL
800-838-5202

GreenPath Debt Solutions
Brooklyn, NY
866-648-8114

GreenPath, Inc./dba GreenPath Debt Solutions
Tempe, AZ
866-648-8114

Money Management International
New York, NY
866-346-2227