If you are defaulting your credit card debt and not even able to make the payments of the outstanding amount on the regular basis, it is better that you negotiate with your credit card company well. It is better to convince them that it's in their interest as well to settle your account. This process would only take place if you are defaulting your payments or stopped paying your EMIs against your outstanding amount. Once you become a defaulter the credit card company dig your records and see your past payment habits. If this is for once or twice they will just send you an email or reminder to make the payments on time, but in case if you are defaulting on payments frequently, then they will take serious action against you.
If you are not making any payment against your outstanding amount in that case you receive a call or letter from the credit card company or bank to meet or discuss the debt or to meet for debt settlement. In that case, you need to do a little home work and do some background work to put your point more strongly and clearly to justify your payment default. If you have done some background work in that case, it will be easy and simple for to identify exactly what your are capable of paying or how much amount you can afford after negotiation. It will help you to negotiating well with bank. You can easily identify the limit of your budget and how much you can afford to pay. Here are some important points you should consider while negotiating with the credit card company/bank to win the situation.
Discuss the situation: When your creditor sends you letter or call you to discuss your situation and reply them promptly to show that you are equally interested in negotiating with them. Put your point strongly and discuss your situation with the creditor. At this point, you can negotiate what you are able to pay. However, the creditor always insist to pay the whole amount. This is the time when you can act smartly and ask for negotiation.
Negotiate well to pay less: It is important that you negotiate well with the credit card company to pay less amount. You should be able to drag the situation into your favour and make the creditor understand that it is a win situation for both. For instance if your credit card debt is Rs. 1 lakh and you negotiate well with bank and settled the payment to Rs. 50,000. That you may be pay in lump sum, or in two or three installments. This is time where you can save more money and try to get out from your increasing debt.
Your monthly payment: In addition, if you are paying higher EMIs you can negotiate with the bank to restructure your EMIs and lower them to make them affordable. But, the monthly payment determines how well you are able to handle it over the period of time. It is important that you tell upfront how much amount you can afford in your future EMIs and what type of payment will be affordable for you. So, ensure that you negotiate well with the bank to make your monthly payments more affordable.
Your account statement/remarks: When you negotiate with bank regarding your payments in case if you are asking for reducing the size of EMIs or you are asking to you make one down-payment to settle the account in that case ask the bank to pay the remarks as “ Paid as agreed” rather than “Settled” as it will help you in building a better credit report for future.