Overwhelmed by Credit Card Debt? Tell them about your hardship.

If your credit is pretty stinky, the previous options are not likely to work well for you. So here’s where that forecast of future financial health is important. You may still get a concession from the bank if you are recovering (or will eventually recover) from a life-changing situation – illness, job loss, separation, divorce, etc.

If this situation fits, call the credit card company and ask to speak to their hardship department. Tell your story plainly and honestly. All creditors have the ability to offer you a deal, but your results may vary. The best you can hope for is a reduced interest rate and lowered payment, in exchange for a direct draft from your checking account. The concession is usually set for 3, 6, or 12 months. Be sure you can make the required monthly payments if you agree to the deal, because you won’t make any friends over at the credit card bank if you miss payments. Not all banks participate, and who and when you call may affect the outcome.

If you have been paying for that extortion-rate credit protection insurance on the card, now would be the time to request an application and get approved for up to a two year freeze in interest while you recover from your malady. If you get turned down for the protection or don’t think you’ll have a need to ever use it, drop it and you’ll save up to 89 cents per $100 of credit card balance every month.

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