What Happens If You Don’t Pay Your Credit Cards On Time?

What Happens if You Don't Pay Your Credit Cards on Time?

So, you have decided that settling your credit card debts on your own is the better path instead of hiring a debt relief company for the purpose.If you have the skills and talents to compete with these professionals when it comes to negotiation, communication and documentation then give it a shot.Not too long ago, a nurse with a little bit of groundwork in tax laws took on the IRS single-handedly then so can you in the case of debt relief.

Keep these points in mind when you are settling credit card debt on your own. These three tips will ensure that you are one step closer to successfully taking on those credit card companies.

Make Sure that Your Accounts Are Significantly Delinquent

You might want to negotiate for lower principal amounts on your credit card bills as soon as you cannot pay the minimum monthly payment required or as soon as you feel that you cannot pay your debts due to other financial obligations. Keep in mind, however, that the debt relief process cannot be availed of until and unless your credit card accounts are significantly delinquent.

Just how delinquent? Well, delinquent credit card accounts are written off as an accounting procedure once these have reached 180-plus days in the ageing method.The writeoff causes the account to drop in value significantly and third parties usually buy these for real cheap – sometimes around 4-6% of the original amount.

To prevent this from taking place, the credit card company will be eager to settle the debt through a negotiation process.If the creditors get half of what you owe, thats much better than the 5% they would’ve gotten from the third party collection agencies.

Detailed Documentation

In this day and age, verbal agreements hold very little merit when it comes to settling credit card debts through the debt relief process.It is your word against the word of the collection agency so there isn’t a clearcut winner in this scenario.

Instead, you should maintain detailed and descriptive records of everything pertaining to the negotiation and settlement of your credit card loans. Always send out letters with complete information to the proper addresses and addressees.After that, file the letters and other forms of communication in a binder that is easily accessible.

If you must make a conversation over the phone, keep descriptive records of it.Document the date, time, the names of the people you spoke with, the contact numbers and the details of the conversation.

Use Mail That Can Be Tracked

When you have reached a settlement, always send your payment through certified mail. Send the check together with a memo saying that said check is for full payment, if indeed it is, along with a copy of the agreed settlement. This way, complete documentation is achieved.

Dont forget the specific strategies that you need to use to settle the debt by yourself. Just remember these three tips and you should be alright during the entire process.

These are some specific steps that you can take. For more tips on how to fix a bad credit report you should read our articles about how to avoid a lawsuit over credit card debt