Over the past year, the country has experienced a severe economic downturn. Stocks are down, costs are up, and many people are losing their jobs, making it very difficult to pay their bills. Many people have had to rely on credit cards to keep themselves afloat, but are now unable to make those payments as well. As the interest continues to accumulate, many card holders are finding themselves deeper and deeper in credit card debt without the means to keep up or pay it off. Before filing for bankruptcy, there is another option: credit card debt settlement.

The main thing to keep in mind when choosing to settle credit card debt is that credit grantors would rather receive some of their money than none of it. Payment in full is always the goal, but when that is not possible, a lesser payment can be negotiated. There are two main ways to go about this. Credit card holders can either hire a debt settlement company to negotiate for them, or they can negotiate with credit grantors on their own.

The advantage to hiring a debt settlement company is that it’s what the company does every day, so you can expect the debt to be settled fairly quickly. They deal with banks on a regular basis and know how to get the banks to agree to settle credit card debt. What the consumer must bear in mind is that on top of the original credit card debt, they will now have the company’s fees to pay as well. Even the free credit counseling services ask for a percentage of the settlement. It’s how they stay in business. In addition, many debt settlement companies will not accept a case unless a minimum amount of debt exists, and that can be as high as $50,000. If a consumer has less debt than the minimum required but still needs help, or even if the amount is larger than the minimum, they may be better off negotiating with credit grantors themselves.

Again, a bank would rather receive some of what it’s due than none of it. Knowing this, a consumer can call the credit grantor and request to settle their debt. The grantor will attempt to talk the consumer out of this and may even threaten legal action if the consumer does not pay the debt in full. The consumer must remain calm and not allow these tactics to deter them. It’s best that the consumer determine how much they’re able to pay before calling the grantor so they have a number to stick to and aren’t talked into paying more than they can afford. It will take some time and some calm negotiating, but it’s not impossible to get the credit grantor to accept an offer of partial payment once it becomes clear to them that it’s in their best interest to do so.

Once the settlement is accepted, the consumer must request that the grantor put the settlement in writing. This is extremely important. It protects the consumer from the company coming after them later for the remainder of the debt. Include a statement in the written agreement that says the grantor will report the debt as paid, not settled. This will keep the consumer’s credit score from being negatively affected by the settlement. Do not send the grantor any money until the settlement agreement has been put in writing, signed, and accepted by both parties.

By staying calm, knowing what to ask for and following through with the agreement, anyone can settle their own credit card debt without paying fees to a settlement company.