If you are overwhelmed by credit card debt, you might want to consider negotiating credit card debt settlement with your creditor. While not exactly an easy process (in fact it can be quite frustrating), you can usually reduce your debt more effectively compared to debt negotiation programs. Certainly, you would want to at least give it a try before resorting to bankruptcy.
It’s important to understand a few factors that are at work when you negotiate credit card debt. First, your creditor is just worried as you are about the debt. He is willing to settle to get something back as opposed to receiving nothing. Second, most credit card companies will probably ignore you until sufficient time has passed since your last payment (say 60 days late). Why? It makes no sense to write off any of the balance if the borrower appears to have the financial means to pay back.
So with the above points in mind, you need to be patient and confident during the credit card debt negotiation. You have some leverage because the creditor wants your money and he would receive nothing if you declare bankruptcy. So use that leverage. The company would work with you if they believe settlement is the best course of action. However, do not expect them to give in to your request very easily. As mentioned above, they would not talk until some time has passed (but do not miss payments on purpose as that would severely damage your credit) and even when they do you can expect many rejections.
What can negotiating credit card debt get you? It depends a lot on each individual company and their leniency for settlement varies significantly. For comparison, you can attain up to 50% reduction in debt and payment terms of 3 years with zero interest. Another thing to note, if your account is in collection, you can expect to settle for less because collection agencies usually spend a minuscule 4-5 cents on the dollar to purchase the debt. Start with a bold offer and try to settle somewhere slightly worse. You just never know what you might be able to attain until you try.