Credit Card Tutorials

Can’t pay your minimum Payments?

Ensuring that the minimum monthly payment is repaid to the credit card company every single month is essential to maintain a good standing account as well as maintaining the credit rating that you have worked so hard to achieve. Many customers are unaware that missing as little as one payment can lead to a lowered credit score, a higher interest rate from the credit card company and a strike that will not be removed from the record for up to seven years.

If you are having trouble making your minimum payments to the credit card company it is essential to know that there are many options available for consumers. At the first sign of financial trouble it is important to contact the credit card Company and explain the situation. They will offer you some of the following options to repay the credit card debt.

Lowering your interest rate. Lowering the interest rate on the credit card could save you money in the future as well as causing a minimal decrease on the monthly payment which is required. Which customers will be eligible for the lowered interest rate? As long as you have a good credit rating, have not missed payments in the past and are contacting the credit card agency before trouble has arisen on the account, you will be a good candidate for a lower interest rate.

Lower Monthly Payments for Three to Six Months. Credit card companies have been known to extend lower monthly payments for three to six months to allow the consumer time to get back on their feet after a financial emergency. These payments could be up to seventy percent lower than your regular monthly payments and come without any effects to the credit rating.

Debt Settlement. Settlement of the account is an idea for those who are suffering from long term financial downfalls and are unable to repay the debt. Contacting the credit card company to see if a debt settlement is available for the credit card means that you are going to suffer on the credit report, but you can lower the amount that is owed by up to fifty percent. These settlements are being offered to many customers, as the credit card companies want to ensure that some type of payment is being made – rather than risking the chance of being defaulted upon.

Interestingly enough, if the credit card company has reviewed your file and noticed regular minimum payments without any additional payments they are contacting many customers to offer these customers a settlement. It is up to you if you take it or not!