Reduce credit-card-debt

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If your credit card debts are out of control you may be thinking about ways to reduce credit card debt. There are a variety of debt relief routes which you can take, which include credit card debt settlement, credit card debt consolidation, and of course, bankruptcy. However, there is a third route, which although lesser known, and that is do-it-yourself credit card debt reduction.

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Reduce credit-card-debt

  1. 1. By Dermot Farrell Copyright © 2012 http://www.CreditCardDebtSecrets.orgThe Secret Behind Credit Card Debt – Copyright 2012 – http://www.CreditCardDebtSecrets.org
  2. 2. If your credit card debts are out of control you may be thinking about ways to reduce creditcard debt. There are a variety of debt relief routes which you can take, which include creditcard debt settlement, credit card debt consolidation, and of course, bankruptcy. However,there is a third route, which although lesser known, and that is do-it-yourself credit carddebt reduction. How to Reduce Credit Card Debt The Do-It-Yourself (DIY) Way!Looking at the two popular debt relief strategies, of credit card debt consolidation and creditcard debt settlement, although both are effective in their own right, they differ quite a lotfrom each other.The more moderate one is credit card debt consolidation, whereby a debt relief companynegotiates on your behalf, looking for a reduction in interest rates, while the more extremeroute which you can take is credit card debt settlement. With debt settlement the debtsettlement company negotiates for a one off settlement of the debt principal at asignificantly reduced rate.Both strategies have their appeal, with credit card debt consolidation, the debt savings arenot so good and it takes a long time to clear your debts, however it is practically risk free.Whereas, with credit card debt settlement, it produces astonishing savings very quickly,however, it has lots of downsides such as loss of credit rating, tax due on monies saved, andpotential court cases.Regardless of which method you decide on to reduce credit card debt, the debt reliefcompany will charge you a fee. In the case of credit card debt consolidation, they will chargea servicing fee throughout the consolidation process. This can become expensive, since debtconsolidation usually runs over a period of several years.Whereas, with debt settlement, the debt settlement company only charges you if theyare successful. However, their fee is usually set at around 15% of the money which they saveyou. So for example if they reduce 40% from the debt of $20,000, then this comes to asaving off $8,000 and a fee in the region of $1200.So there is no question about it, if you opt to reduce credit card debt, without joining a debtrelief program, there are some potential savings. However, if you reduce credit card debt bythe DIY way, there are also some downsides to bear in mind. What are the Downsides if I Decide to Reduce Credit Card Debt the DIY option? The Secret Behind Credit Card Debt – Copyright 2012 – http://www.CreditCardDebtSecrets.org
  3. 3. If you want to reduce credit card debt with the do-it-yourself option, then you will have tocontact your creditors directly, and negotiate with them all by yourself.It is this lack of leverage which is a potential hazard for anyone who wants to reduce creditcard debt by themselves. Debt relief companies have both experience and an in depthunderstanding of credit card companies, their employees understand the methodologieswhich each credit card company applies, and they probably have a working relationship withmost of the credit card companies. This puts the debt relief company at a serious advantageover and above the DIY negotiator.If a lone credit card debtor contacts their credit card companies, seeking to reduce theirdebt, or even to reduce the interest on their credit cards, chances are that unless theywithhold their payments for a long time, the credit card companies will simply ignore them,or give them some lip service.And even if the credit card debtor withholds their credit card payments, in order to gain thisnecessary leverage, in the process their credit score will end up been badly affected.To sum up, it’s not that the individual credit card debtor can’t self-negotiate; rather it’s justthat unless they know what they are doing, they will more than likely either alienate thecredit card companies, or they will receive only a token discount on their credit card debts,or monthly interest rates. So if I Want to Reduce My Credit Card Debt, on My Own, How can I Make it Work for Me?If you want to reduce credit card debt on your own, the first step is to prepare well beforeyou start negotiating. There is no point in thinking to yourself that you are going to saveon debt relief company charges, only to go out and make a Mickey Mouse effort with thenegotiation process.Also, unless you are well versed in negotiation and credit card company debt handlingprotocol, you will have a difficult time, even if you do apply yourself.However, there is help at hand under the guise of debt relief negotiation educationcourses, which walk you through the stages required to renegotiate your debts. While thereis a charge for these services their fees are fairly low, ranging anywhere from around $100 to$600, depending upon the level of tutoring provided by the provider.Of course, these self-negotiation courses will not suit every credit card debtor, because itmust be kept in mind that there is a high level of organizational and negotiation skillrequired, which is beyond the skillset of a great many credit card debtors. The Secret Behind Credit Card Debt – Copyright 2012 – http://www.CreditCardDebtSecrets.org
  4. 4. So, if you wish to take up the do it yourself option, unless you are used to negotiating withfinancial companies, you would be best advised to consider a coaching course. Also, ifyou take up this option, it is necessary that you have a certain range of aptitudes and skills,otherwise, you well be better off simply hiring the professionals to negotiate on your behalf.There is no question about it, it is possible to reduce credit card debt, the DIY way.However, it doesn’t suit all debtors. If you look into your particular circumstances and take anoverview of your skillsets, then maybe this is a viable option for you to take. Certainly manycredit card debtors do manage to reduce credit card debt the DIY way, maybe it is also yourway too. The Secret Behind Credit Card Debt – Copyright 2012 – http://www.CreditCardDebtSecrets.org

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