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Is negotiating with creditors a way to avoid personal bankruptcy?

As the economy took a downturn, many people began to pull out their credit cards to pay bills or just to make ends meet. Many people in New Jersey and across the United States fell on hard times and landed in piles of credit card debt. However, there are some possible ways to negotiate with a credit card company to attempt to make the debt a little easier to pay back. In cases where this isn't possible, filing for personal bankruptcy may be a beneficial solution.

A consumer who is in good standing with the credit card company will have a better chance at negotiations than one who is not. If a person has been paying his or her bills in a timely fashion for a long period of time and then suddenly falls on hard times, the creditors may be a little more inclined to help. In some cases, an individual may have to call more than once or speak to several different people, in particular a manager, to achieve the desired result.

In the event that someone cannot make the minimum payment, a representative may help lower the payment to something more affordable to keep the account current. That also applies to lowering the interest rate or changing the due date for the payments. Those in good standing may also be able to ask for a late charge to be removed if the occurrence is something that only happens once or twice a year and is a legitimate mistake.

If the debt situation is more extreme, there are also ways to work out paying a lump sum to pay off the debt. Rather than receive little or no money at all, a credit card company may take the offering as an attempt at cutting their losses. There may also be options to not make payments for a set period of time or to make much smaller payments over an extended period of time. In some cases, the traditional methods may not be the way to help a New Jersey resident out of debt. Filing for personal bankruptcy can be a way for a person to start over with a clean slate and be debt free once and for all.

Source: newsnet5.com, "Can you negotiate with your credit card company?", Abby Hayes, May 12, 2014

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