These days, Americans are up to their eyeballs in credit card debt. A few decades ago, credit cards were used primarily for travel; you might use one at a hotel or a restaurant.  In the 1960’s, few people envisioned using them at movie theaters or for home delivery pizza. The increased convenience is nice, but that has led to overuse, particularly by people who are not accustomed to paying their bills in full. For them, convenience has led to the nightmare of having debt that they are unable to repay. In years past, one solution used by many with too much debt was to file for debt relief through bankruptcy court. That is still an option for many consumers, but Congress has recently made it much more difficult to do. More and more, consumers with financial troubles are realizing that they must repay their debts, one way or another. Is there a solution, other than to enroll in an expensive debt management program?

There might be. In fact, you might be able to negotiate with your credit card companies yourself. If you have a history of paying on time, you might be able to call them and simply ask them if they will lower your interest rate. They may or may not agree, but keeping an existing customer happy is less expensive than trying to find a new customer. It’s often easier just to help you out and lower your rate. On the other hand, if you have been paying late, you probably won’t get much sympathy from your creditor. If you are a lot behind, and haven’t made a payment in months, you might be able to negotiate a settlement plan with the company. If they have a strong feeling that you will never pay them in full, they might be willing to settle for less, provided that you can pay it promptly. Be aware, however, that any debt that is forgiven by the company becomes taxable income. This solution is more complicated than it appears. After all, if you have the money to settle, you have probably had the money to send in monthly payments. Still, it is a viable option for some debtors and credit card companies will often go with whichever option allows them to save the most money. Selling your debt to a collection agency costs them a lot, so agreeing to take some payment from you may help.

Should you get your company to settle for less, you will see some impact on your credit report. There will be a notation that your debt was repaid, but that it was settled for less than the full amount. Paid is paid, isn’t it? Not in all cases. In this case, your credit score will be reduced and potential creditors who examine your credit report prior to making a loan will realize that they may be taking a risk by lending to you.

If you cannot afford credit counseling or are simply the do it yourself type, you can occasionally benefit from talking to your credit card company yourself. There is nothing to lose.