Dealing With A Large Credit Card Debt Problem
Posted by: Tina Gold Post date: January 5th, 2010
There are always two sides to any large credit card debt problem. On the one hand there is you, the debtor, struggling to repay your credit card debt. On the other side is the credit card company who expect you to repay your credit card debt according to the terms and conditions they decide.
When we buy things on a credit card it may not feel like we are using real money and the credit card companies like it like that. They don’t want us to worry about getting into debt because they want us to use their credit cards to make them lots of money. Since it is so easy to get yourself into debt a lot of us have done exactly that and while this was ok when times were good and there was plenty of money around now, well, things have changed. A lot of us are finding we are dealing with a large credit card debt problem thanks to us enjoying the benefits of easy credit and now we have to find a way to deal with the debt crisis we find ourselves in. All of us would want to be able to repay our debts and get straight again but for some of us this is proving difficult.
There are two sides to a debt problem and if we were dealing with a person we owed money to it might be easy to talk and come to an agreement of how we could repay the debt. Perhaps we could agree to reduce the repayments and pay over a longer period of time. It didn’t use to be like that with the credit card companies. They wanted their money, their pound of flesh, when it was due and they were not keen to hear about your financial problems but times are changing due to the financial problems everyone seems to be experiencing.
Dealing with a large corporation is different to talking face to face with a real person you owe money to. They have their rules and their staff must follow the rules they are given but even the large credit card companies have learned they have to be a bit more realistic about debt problems.
If you default on your credit card debt the credit card company will chase you for a while to try to recover their money but after a time they will give up and sell the debt on to a debt collection agency for pennies on the dollar. The credit card company will lose a lot of money doing this so they only do it as a last resort when they feel they are wasting their time chasing you for money.
You don’t get away with the debt, so don’t go thinking you do. The debt will now be with the collection agency and they can be very rigorous in trying to recover the money and they will probably add additional costs and charges to the original debt. This is not good for you or for the credit card company who have lost a lot of money through dealing with you.
The plain fact is that once it gets to this stage the credit card company have lost a lot of money that they will never see again. They do not want to have to sell on the debt. What they want is for you to repay your debt to them so if you can approach them and explain your financial circumstance and say that you do want to pay them but you are struggling right now, they may be more willing to come to an arrangement over debts with you.
It may be they will insist on closing the credit card account to any new transactions but that is a good thing because it means you won’t add more debt to the account. You could offer to make a smaller payment that you can be sure of managing every month and extend the period of time the debt can be repaid over. They may not be prepared to make a deal but many will do so because they can see that otherwise they will lose everything and something is better than nothing.
There are other possibilities and you might be able to consolidate debts with a debt consolidation loan but you could also try approaching your credit card company and explaining you are dealing with a large credit card problem. Tell them you want to repay the whole debt eventually but you are struggling with the repayments right now and this should make them more willing to consider what you offer.
Credit card companies may be faceless organizations but they are not stupid and they should see that they will get more money back if they are prepared to come to an arrangement with you rather than give up and sell the debt on to a debt collection agency.
Related posts:
