Negotiate credit card interest - but I am a little late on payments.?

Question

I have a very high balance on my credit card, I was late for 20 days and they charged me the maximum APR @ 34% a year. I am paying almost 400.00 in interest every month.

I am reallt thinking in just stop paying the card or file bankruptcy.

But before I do this is there any other option, which one is the best?:

1 - Be in default for 2 months and them call and try to settle an amount?

2 - Call them right now and ask to reduce the interest rate to the previous one (it was 9% APR) (Even though I was late on my payments and I used all the remaining credit?)

3-File Bankruptcy

4-Just dissapear and wait 7 years to have a new credit history.

Thank you

If they say they cannot lower my APR it is a good idea to tell them that I will simply stop the payments, and even though the oustanding credit is very high I don't have a house in my name, I am unemployed (they cannot garnish my wages), I don't have a car, meaning the only one that will loose something is the credti card company.

Answer 1

You can settle. But, if you violate the terms of the settlement (by as little as one day), they can bring the wrath of their collections down on you without fear.

I am not one to be giving you advise, but I would borrow the money from somebody else and pay the jerks off (if you can get it).

If you do not pay them off (and just walk away), when you get ready to buy a home, there will be a cloud on your credit that can harm you (for more than 7 years).

Now, the way around that is for the home to be in your spouses name only (and she is the only one that qualifies for the home).

Answer 2

You can request lower rates, but you generally need to show financial strength. You represent a high credit risk.

Your credit card issuers will generally agree to much lower interest rates if you commit to a debt management plan. They also re-age the accounts, meaning you do not have to make a double payment to return to current status. It can give you a break from fees as well.

Answer 3

I tried re-negotiating my rate based on perfect payment history for three years with the Credit card company. They started charging me a "default" rate for a two late payments 2 years ago.

Their response was that they can legally charge a default rate even if I pay them every month on time forever, if they see even one late payment to anyone else, ever! They said they sent that notice to me, and therefore they don;t understand why I am questioning it.

I sent the information to my state AG office, who is investigating and creating laws to outlaw this BS practice.

Answer 4

All you can do is ask. Tell them that if they can't work with you, your only available option is to consult a bankruptcy attorney. See how it goes.

Keep asking for higher-level managers, over and over again if necessary. Go as high as they'll let you. The basic phone-answering monkey you'll get first will have ZERO ability to drop your rate, so bypass them right away.