• Skip to primary navigation
  • Skip to main content
Good Financial Cents®
Content is based on in-depth research & analysis. Opinions are our own. We may earn a commission when you click or make a purchase from links on our site. Learn more.
  • Make Money
    • Get Money Now
      • Ultimate Guide to Making Money
      • Need Money Now
      • Get Free Money Fast
      • Make Money Fast
      • Make $1K Per Month
      • Make $100 Per Day
    • Control Your Destiny
      • Self Employed Jobs
      • Make Money from Home
      • Hobbies That Make Money
      • How to Become a Freelance Writer
      • Small Business Ideas to Start
      • How to Become an Independent Contractor
      • Best Online Jobs
    • Passive Income
      • Passive Income Ideas
      • Multiple Streams of Income
      • Extra Income
      • Residual Income Ideas
      • Learn to Sell e-Books
      • Make Money on Facebook
      • Make Money on Tiktok
      • Best Online Survey Sites to Make Money
    • Explore More
      • Best Side Hustle Ideas
      • Make Money for Teens
      • Best Online Colleges
      • Best Jobs No College Degree
      • Become a Millionaire
      • Careers for the Future
  • Manage Money
    • Best Of
      • Budgeting Tools
      • Personal Finance Software
      • Best Cashback Cards
    • Company Reviews
      • Personal Capital vs Mint
      • Personal Capital Review
      • SmartAsset Review
    • Guides
      • Buy or Lease a Car
      • What is Liquid Net Worth?
      • Setting Financial Goals
      • How to Budget
      • Ways to Save Money
    • Explore More
      • How Much Car Can I Afford?
      • Best Auto Refinance Companies
  • Invest
    • Best Of
      • Best Short and Long-Term Investments
      • Best Low Risk Investments
      • Best Online Stock Brokers
      • Best Crypto Exchanges
      • Best Short Term Investments
      • Best Long Term Investments
      • Best Trading Platforms
      • Best Investment Apps
    • Company Reviews
      • Lending Club
      • Robinhood
      • M1 Finance
      • Ally
      • TD Ameritrade
      • Fundrise
      • Betterment
      • Etrade
      • Wealthfront
    • Guides
      • Investing for Beginners
      • Investing Small Amounts of Money
      • Investing in Real Estate
      • No Money Down Real Estate
      • Bonds vs Stocks
      • Peer to Peer Lending
      • Best Hedges Against Inflation
      • Safe Bitcoin Investing in 2023
    • Explore More
      • Bitcoin vs. Real Estate
      • Betterment vs Wealthfront
      • Investing for College Students
      • Stock Market Alternatives
    • By Investment Amount
      • How to Invest $100
      • How to Invest $1K
      • How to Invest $2k-$3k
      • How to Invest $5K
      • How to Invest $10K
      • How to Invest $15k
      • How to Invest $20K
      • How to Invest $30k
      • How to Invest $50K
      • How to Invest $100K
      • How to Invest $200K
      • How to Invest $500K
      • How to Invest $1M
  • Taxes
    • Best Of
      • Best Tax Relief Companies
      • Best Tax Software
    • Guides
      • Federal Income Tax Guide 2023
      • Taxes and Cryptocurrency
      • How to Do Your Own Taxes
      • How to Invest Your Tax Refund
      • Hiring a Professional Tax Preparer
      • Tax Tips for Freelancers
    • Company Reviews
      • TurboTax Review
      • H&R Block Review
      • Taxslayer
      • Tax Act
  • Insurance
    • Best Of
      • Best Life Insurance
      • Best Home Insurance
      • Best Auto Insurance
      • Cheap Term Life Insurance
      • Car Insurance For Young Adults
    • Guides
      • Term vs Whole Life
      • Different Types of Car Insurance
      • Average Cost of Car Insurance
    • Explore More
      • Life Insurance Over 50
      • Life Insurance Over 80
      • $1 Million Life Insurance
      • $2 Million Life Insurance
      • $3 Million Life Insurance
    • Company Reviews
      • Banner Life Insurance
      • Ladder Life Insurance
      • Health IQ
      • Haven Life
      • Policygenius
      • State Farm Auto Insurance Review
  • Retirement
    • Roth IRA
      • Best Places to Open a Roth IRA
      • Best Investments for Roth IRA
      • 7 Roth IRA Secrets
      • Roth IRA Conversion Guide
      • Roth IRA Rules
      • Roth IRA vs Roth 401k
      • Are Roth IRA Contributions Tax Deductible?
    • 401(k)
      • 401(k) Limits
      • 401(k) to Roth Rollover
      • Is 401(k) Enough for Retirement?
      • Maxed Out 401(k): What's next?
    • Traditional IRA
      • Traditional IRA Rules and Limits
      • Traditional IRA vs. 401(k)
      • Simple IRA Rules
      • SEP IRA Rules
      • How Much Do You Need to Start an IRA?
    • Explore More
      • SEP IRA vs. Roth IRA
      • 457 Plan for Successful Retirement
      • 401a Rollover Rules
      • How to Retire at 50
      • How to Retire at 55
  • Banking
    • Best Of
      • Best National Banks
      • Best High-Yield Savings Accounts
      • Best Checking Accounts
      • Best Savings Accounts
      • Best CD Rates
      • Best Money Market Accounts
    • Company Reviews
      • BBVA
      • Synchrony
      • Wells Fargo
    • Explore More
      • 9 Banking Alternatives for 2023
      • What is a Credit Union?
  • Home
    • Best Of
      • Best Mortgage Lenders
      • Best Mortgage Refinance Companies
      • Best Home Warranties
      • Best Homeowners Insurance
      • Best VA Loans
      • Best Mortgage Rates
      • Best Moving Companies
      • Best Home Security
    • Guides
      • Home Buying Checklist
      • Online Home Appraisal
      • How Much House Can I Afford?
      • First-time Homebuyer Programs
      • How to Get Approved for a Home Loan
      • Save Money When Building a House
      • How to Save for a Downpayment
      • When to Refinance Your Mortgage
    • Explore More
      • 15 vs. 30-year Mortgage
      • Home Warranty vs. Home Insurance
      • Veterans United Home Loan Review
      • Quicken Loans Review
      • HELOC vs Second Mortgage
      • DCU Mortgage Review
      • Costco Mortgage Program Review
      • USAA Mortgage Loan Review
  • Credit
    • Best Of
      • Best Credit Repair Companies
      • Best ID Theft Protection Services
      • Best Credit Report Options
      • Best Bad Credit Loans
    • Guides
      • How to Build Your Credit Score
      • How to Raise Your Credit Score in 5 Months
      • How to Dispute Your Credit Report
      • Hot to Remove Collections from Your Credit Reports
      • How Identity Theft Destroys Your Credit Score
    • Explore More
      • What is a Good Credit Score?
      • What is a Bad Credit Score?
  • Debt
    • Best Of
      • Best Debt Consolidation Loans
      • Best Personal Loans
      • Best Student Loans
      • Best Student Loan Refinance
    • Guides
      • What is Debt Consolidation?
      • How to Get Out of Debt
      • How to Get a Personal Loan Approved
      • How to Pay Off Student Loans Faster
      • Should I Consolidate My Debts?
      • Should I File for Bankruptcy?
    • Company Reviews
      • Credible
      • Sofi

How to Negotiate with Credit Card Issuers

https://www.goodfinancialcents.com/wp-content/uploads/2019/07/MG_5503-150x150.jpg
  • Written By:
    Jeff Rose, CFP®

    Jeff Rose, CFP®

    Jeff Rose, CFP® is a Certified Financial Planner™, founder of Good Financial Cents, and author of the personal finance...

    Read More
  • Updated: September 3, 2021
  • 10 Min Read
  • Advertising Disclosure

    Advertising Disclosure

    GoodFinancialCents® has an advertising relationship with the companies included on this page. All of our content is based on objective analysis, and the opinions are our own. For more information, please check out our full disclaimer and complete list of partners.

Quality Verified THE GFC® PROMISE
shield check icon
Quality Verified

GoodFinancialCents® partners with outside experts to ensure we are providing accurate financial content.

These reviewers are industry leaders and professional writers who regularly contribute to reputable publications such as the Wall Street Journal and The New York Times.

Our expert reviewers review our articles and recommend changes to ensure we are upholding our high standards for accuracy and professionalism.

Our expert reviewers hold advanced degrees and certifications and have years of experience with personal finances, retirement planning and investments.

shield check icon
Why You Can Trust GoodFinancialCents®

GoodFinancialCents® partners with outside experts to ensure we are providing accurate financial content.

These reviewers are industry leaders and professional writers who regularly contribute to reputable publications such as the Wall Street Journal and The New York Times.

Our expert reviewers review our articles and recommend changes to ensure we are upholding our high standards for accuracy and professionalism.

Our expert reviewers hold advanced degrees and certifications and have years of experience with personal finances, retirement planning and investments.

You probably didn’t get into credit card debt overnight.

For most of us it’s a gradual process of buying a little too much, then missing a payment or two, then realizing the card’s introductory rate expired and the full 26.99 percent of interest just kicked in.

I know all this because I’ve been there, too. Before you know it, you owe $5,000 on a card that had only a $3,000 limit, and it feels like taking a breath is costing you interest.

It can be tempting to forget the whole mess — to stop even trying to pay the balances; to just accept you’ll have rotten credit for the better part of a decade.

The Truth About Credit Card Debt

credit card numbers

You could negotiate a better solution with your credit card companies.

We’ve reached the point where you might expect to hear something reassuring, right? This is where I should say, “Yes, you can get out of debt. Things aren’t as bad as they seem. You just need to keep trying.”

Well, there is some truth in that, but I’d rather just be straight with you:

If you’re in deep with one or more credit cards and you’re starting to feel like it’s hopeless, you can still get out of the hole.

But it’s going to take more than patience. It’s going to take a lot of persistence, some self-discipline, and some serious strategizing.

A good starting point for any strategy will be to ask your credit card issuer for help, and that’s what this post is about.

Why Would My Credit Card Negotiate With Me?

Like I said, I’ve been there. I know how it feels. Every time you pay on your credit card balance, you don’t see any results on the bottom line.

At this point, the credit card company is simply taking your money and not even reducing your balance in any meaningful way. Why would it want to help you put an end to that set-up?

Well, yes, it is a credit card company’s goal to make money by lending you money at interest and then enforcing its rules about late fees, over-balance fees, and punitive interest rates.

But that doesn’t mean the company benefits from your out-of-control account, especially if you give up on paying it off.

Let’s take a look at it from the credit card’s point of view:

  • If you give up, the company spends a lot of time and money trying to collect your balance, then finally sells off your debt for pennies on the dollar.
  • If you give up, the company loses the ability to lend you money since you no longer qualify for loans, meaning they’ve lost a customer.
  • Not only has your credit card lost your business, but the entire legitimate credit industry has lost you as a customer because your credit score prevents you from borrowing except in rare situations.

But working with your creditors is not an exact science. You can’t just call the customer service line and set your terms.

You’ve got to know what to ask and how to ask it. You need to know who has the authority to help you. You need to know how much you can afford to pay if you reach a settlement.

If you’re ready to make this happen, to get out of from under that dark cloud you’re carrying around in your purse or wallet, read on to learn about some strategies.

First Things First: Adjusting Your Outlook

Before we get into the details, it’s time to get prepared for battle. You won’t need armor or weaponry. You could need some polish for your negotiating skills, though.

Here are some obvious things that can go a long way:

Be Nice and Polite

Yes, as a customer, you do have some sway, but that doesn’t mean you should go in guns blazing and making demands for lower interest rates and forgiveness of late fees.

Instead, engage with a spirit of cooperation. This can be helpful elsewhere in life, too. Being willing to look for solutions that mutually benefit both parties will open doors.

Accept Responsibility

passive income ideas include paying off your credit card

Accepting some responsibility can work its own kind of magic during negotiations.

Like it or not, if you’re in some credit card trouble, your choices helped create the situation. Even if you feel tricked or cheated, you still made the decision to use the card.

If you had no choice but to over-use the card because you were struggling to buy groceries and your roommate disappeared without paying the power bill, you still benefited from the transactions that led to the current chaos.

If this is true, it’s not helpful to open negotiations by pointing fingers at the credit card company for its behavior.

Doing that will likely get you written off as unreasonable and simply unwilling to pay what you owe.

Accepting responsibility for the situation can work its own kind of magic.

Instead of saying, “You people are stealing from me and ruining my credit,” say, “I let things get out of control and would like to talk about possible solutions.”

Be Willing to Go the Long Haul

Chances are you won’t solve your problems in one phone call or even two or three phone calls. But you can save time by knowing this up front and being willing to call back and continue the discussion.

Once you’ve reached a credit manager or someone else with the authority to make changes to your account, get that person’s name and direct contact information.

That way you can get back in touch with them directly after you’ve had a chance to think about the solutions you’ve discussed.

If you don’t get immediate results, try again the next day and the next week. Too many people open negotiations and then never follow up because they didn’t like the manager’s first offer.

Knowing What a Credit Card Issuer Can Offer

After you’ve started discussing your situation with a credit manager, you’ll start to hear some terms thrown around.

It’s important to know the difference between credit resolution strategies because some solutions could hurt your credit even as you resolve the problems with your account.

Lump-Sum Settlement

One of the fastest and easiest ways out of debt is to settle on a lump sum. If your credit card trouble is part of a larger financial problem I realize you may not have this option.

After all, if you had lump sums of cash laying around, you probably wouldn’t have an out-of-control credit card or two.

But it’s still a good option for a lot of people, especially if they’ve just inherited some money or sold some real estate and would like to use the proceeds to get out of debt.

Let’s say, for example, you owed $10,000 on one card, though only $7,500 of that was money you’d actually spent. The other $2,500 resulted from fees and interest rates.

In this case, you may be able to agree on paying off just the $7,500.

Be absolutely sure the money you’re paying will close the account and result in a zero balance. Get it in writing before sending the money just in case there was a misunderstanding or in case the credit manager entered the wrong code on your file.

Here’s something else important: Find out how the credit card company plans to report the settlement to the credit bureaus. If they call it a charge-off, this could hurt your credit score.

Workout Agreement

A workout agreement resembles a lump-sum payment without the lump sum.

You basically will stop using the account and can eliminate some or all of the late fees that resulted when you surpassed the card’s credit limit.

You can also erase some or all of the finance charges incurred because of punitive interest rates which kicked in when you maxed out the card.

Basically , you can turn the clock back to before things got out of control.

You’ll still owe the principal balance and will need to pay it off within an agreed-upon amount of time. But things won’t be getting worse every minute.

Keep in mind this kind of deal can hurt your credit score in the short run because your “available credit” will take a hit. Your amount of available credit is one of the factors credit bureaus consider when compiling your score.

The way the credit card company reports this deal can also impact your score. Try to avoid a charge-off which will look bad to other creditors.

Forbearance Programs

Some credit card companies may offer to put your account in forbearance. (If you owe student loan money you may already know all about forbearances.)

This can be a very convenient tool if you have a temporary financial problem such as unemployment or short-term disability.

However, forbearance is not a long-term solution to your credit card problems. Yes, you’d be getting a break from payments and late fees, and you may even be able to get a lower interest rate during the forbearance period.

But after the period ends, you’ll still owe the entire balance of your card. Your balance may even go up some since it would still generate interest while you aren’t paying.

Use this deal only as a temporary solution to get you through a rough patch, not as a long-term solution.

Note: If you successfully negotiate your debt favorably, you could owe more on your taxes. The IRS considers forgiven debt a form of income. Your tax software should be able to handle this.

Look at Your Overall Picture Before Making a Decision

Only you know what you can afford as you negotiate with a creditor. Before agreeing to a plan of any kind, make sure the payments you’re agreeing to fit your budget.

All the negotiating in the world won’t help if you still can’t afford to pay the agreed-upon amount. And things could be worse since you’ll have to go back to the drawing board with less strength from which to negotiate.

So, if you don’t already have a budget, make one. Or at least do some quick math to find out how much you’re spending on gas, food, the mortgage, and other essentials so you’ll know how much you can spend paying down your credit card debt.

Make a Realistic Plan You Can Follow

Fixing your debt issue will require some sacrifice, but don’t sacrifice too much.

If you’re thinking about getting your financial life on track by eating out less and going to the movies only twice a month instead of four times a month, that’s great.

If you’re looking to cut your Amazon spending in half, that’s good, too.

However, don’t go overboard by making sacrifices you can’t continue. That will set yourself up for failure. Chances are you’re going to have to eat out at some point during the month, so saying “I won’t eat out so I can pay off my credit card” may not be the best plan.

In other words, don’t paint yourself into a corner in an attempt to get out of debt. Be reasonable and make decisions that you can sustain.

Knowing how much you can realistically afford to spend on debt reduction will help in your negotiations.

Let the Credit Card Negotiations Begin

You know how much you can afford to pay and you know what a credit card company might offer. Now it’s time to get started negotiating.

You didn’t get into debt overnight, and it’s going to take more than a few minutes on the phone to negotiate a solution.

Save Your Ammo

You can start by calling the number on the back of your credit card or the contact number you find online. The first person who answers will likely be unable to help, though.

Don’t use your negotiating prowess on that person. Instead, kindly ask for someone who can actually make decisions about your account.

For most companies, this person is a credit manager or account manager. Get this person’s name and contact information right away in case you’re cut off and so you can cut to the chase next time you call.

Because there will be a next time. You shouldn’t agree to the first offer the manager throws out.

Take notes and ask for some time to think about the offer. After you hang up the phone, run some numbers. Does the offer help you get out of debt sooner? How does it fit into the larger plan of your monthly finances?

Can You Get a Better Offer?

If the offer you got doesn’t measure up, or if you think better terms would help you get back on track much faster, call back and make a counter offer.

Ask the manager why he or she can’t lower your interest rate back to its original percentage or erase all of those late charges.

Again, be willing to work with the manager and don’t fall into the trap of accusing the credit card company of cheating you or intentionally luring you into the world of high-interest debt.

Stay patient, and cooperative, but also stay persistent. Keep calling back until you have the answers to your questions.

Remember, the credit card company has an interest (pun intended) in keeping your account open.

Get It In Writing

Assuming you do reach an agreement that helps you — and I think you can — be sure to get the terms in writing before you agree to the deal, and certainly before you send in a check or an online payment.

Things happen: Codes get entered incorrectly. The manager you worked with may get a phone call right after yours and mix things up in his or her head before making notes.

Getting your new terms in writing helps you know what you’re agreeing to, and it gives you some recourse if the agreement doesn’t play out the way you’d expected.

Live Up to Your Promises

If you agree to pay off a certain balance in a specified amount of time, be sure you follow through on your end of the bargain.

Failure to pay a negotiated settlement can wreak even more havoc on your precarious credit situation.

In Too Deep? A Third Party Can Negotiate

People who have more than a few credit cards teetering on the edge of disaster may find it too daunting to negotiate each one individually.

Third-party debt management programs exist to help. Here’s how they work:

They pay off all of your accounts, then issue you a new loan for the combined balances they paid off. Chances are this new loan will have a lower interest rate, which means you can pay less monthly on the same principal debt.

When you go this route, keep a few things in mind:

  • A lower score: Your credit score will still take a hit because of all the closed accounts. But at least you’ll be preventing a credit score disaster by letting the individual credit card accounts go bad.
  • You have a right to know: The credit manager negotiates on your behalf, but you still have a right to know how they’ve managed to negotiate your accounts. Again, try to avoid charge-offs if possible.
  • You’re still paying all of the debt: In most cases, you’ll still be paying the full balances of the accounts. They’re being consolidated and not negotiated down.
  • Control spending going forward: You should have a little more room in the monthly budget compared to before your debt consolidation. Use that room to get ahead in your finances and not to accrue more trouble.

Why Bother Negotiating to Start With?

As individuals, credit can get us ahead in life. Just imagine how hard it would be to buy a house if you had to save $200,000 of your own money while simultaneously paying rent.

Credit is a two-edged sword. It gives our economic system liquidity for day-to-day activities, but it also gives us the ability to overextend ourselves.

When you’re drowning in too much credit, you risk losing the buying power credit gives you. By getting your credit cards under control, you’ll save yourself a lot of money down the line.

Even if you already have a car and a house and feel like you could let your credit score go, think about what you don’t know and how credit could help:

  • What if you needed to borrow $12,000 for a new HVAC system next winter?
  • What if you had a great idea for a new business but needed to borrow some capital to get it going?
  • What if your son or daughter needed you to cosign on a loan for a car or a student loan in a few years?

These are among the dozens of good reasons to keep your credit score as high as possible — to keep yourself a viable participant in the credit market.

If out-of-control credit cards have you on the verge of losing this ability and you see very little hope for paying off your cards, start the process of getting out from under that debt by asking for help.

You aren’t asking for forgiveness or an unreasonable favor — just a better way to keep moving forward.

Facebook LinkedIn Twitter

About the Author

Jeff Rose, CFP® is a Certified Financial Planner™, founder of Good Financial Cents, and author of the personal finance book Soldier of Finance. He was a financial planner for 16+ years having founded, Alliance Wealth Management, a SEC Registered Investment Advisory firm, before selling it to focus on his passion - educating the masses on the importance of financial freedom through this blog, his podcast, and YouTube channel.


Jeff holds a Bachelors in Science in Finance and minor in Accounting from Southern Illinois University - Carbondale. In addition to his CFP® designation, he also earned the marks of AAMS® - Accredited Asset Management Specialist - and CRPC® - Chartered Retirement Planning Counselor.

While a practicing financial advisor, Jeff was named to Investopedia's distinguished list of Top 100 advisors (as high as #6) multiple times and CNBC's Digital Advisory Council.

Jeff is an Iraqi combat veteran and served 9 years in the Army National Guard. His work is regularly featured in Forbes, Business Insider, Inc.com and Entrepreneur.

Facebook Twitter LinkedIn

You Might Also Enjoy

How to Remove Negative Items from Your Credit Reports

How to Remove Negative Items from Your Credit Reports

How to Raise Your Credit Score 100 Points or More in Less Than 5 Months

How to Raise Your Credit Score 100 Points or More in Less Than 5 Months

5 Best Identity Theft Protection Services of 2023

5 Best Identity Theft Protection Services of 2023

How to Build Your Credit Score

How to Build Your Credit Score

7 Best Credit Repair Companies of 2023 - Updated for February

7 Best Credit Repair Companies of 2023 - Updated for February

What is a Bad Credit Score? (Plus How to Improve It)

What is a Bad Credit Score? (Plus How to Improve It)

Leave a Reply

Cancel reply

  • Make Money
  • Manage Money
  • Invest
  • Taxes
  • Insurance
  • Retirement
  • Banking
  • Home
  • Credit
  • Debt
  • About
  • Contact
  • Facebook LinkedIn Twitter

© 2023 Good Financial Cents®. All Rights Reserved. | Privacy Policy | Disclaimer

All written content on this site is for information purposes only. Opinions expressed herein are solely those of AWM, unless otherwise specifically cited. Material presented is believed to be from reliable sources and no representations are made by our firm as to another parties’ informational accuracy or completeness. All information or ideas provided should be discussed in detail with an advisor, accountant or legal counsel prior to implementation.

All third party trademarks, including logos and icons, referenced in this website, are the property of their respective owners. Unless otherwise indicated, the use of third party trademarks herein does not imply or indicate any relationship, sponsorship, or endorsement between Good Financial Cents® and the owners of those trademarks. Any reference in this website to third party trademarks is to identify the corresponding third party goods and/or services.