Why You Shouldn’t DIY Credit Card Negotiations
If you’ve missed several payments on your credit card and racked up charges that are now hard to pay off, seeking debt settlement is your best way out. Settling debt refers to negotiating with your creditors to pay back what you can while being forgiven for the rest. This negotiation is best performed by a professional as credit card settlement negotiations can be stressful and intimidating.
However, given you already have a considerable debt to pay off, adding financial advisor fees to your expenses may not be appealing right now. As a result, you may consider negotiating your debt settlement on your own. But, before you proceed in this direction, it vital to consider the drawbacks of this approach, as it could cost you dearly. To help you see what could go wrong, Entelechy Management Inc. has put together a few reasons as to why you shouldn’t DIY credit card negotiations.
1. It might be more than you can handle
When taking on a task like this, it may take multiple hours a day across many weeks to get one account settled. Multiply that by the number of accounts you’re working with. This can interfere with time dedicated to your work and any income associated with time away from your job. If you are inexperienced, you can also end up owing more in the long run. In some cases, large lump sum payments are required right away.
2. You can negatively affect your credit score
When you attempt to negotiate a credit account, some creditors may be reluctant to come to any agreement and may increase your total amount owed. They increase it by lowering your limit (without your knowledge or consent), raising your interest, increasing your monthly payments, or a combination of any of these. If you owe more than your limit or don’t pay the new minimum payment, they can charge late fees, which will increase your total amount owed. This can also negatively affect your credit score.
3. You might be tricked into a “good deal”
Because you aren’t aware of the technical aspects of the process, when attempting to settle your own accounts, you may be tricked into a “good deal.” The creditors may often entice you with a lower interest rate by a few percentages and claim that it’s as low as they are allowed to go. If you agree to these new terms, you are stuck at that rate even if you find out that they can go lower. This is very difficult to fix right away, and you may have to wait six months to a year to renegotiate new terms if they are willing to negotiate again.
The truth is that creditors have every reason to make negotiations unpleasant or difficult. Moreover, the longer you wait to take action, the more your accounts will rack up interest owed and possibly late fees.
Do things right - Hire a professional
To negotiate your credit, you will need to know the current debt collection laws in your state. You also need working knowledge of average interest rates and contact information for specific negotiations, department per creditor, and when they are willing to negotiate. Factors that can greatly impact the rate of a settlement will be the time of year, the debt amount, length of time an account has been opened, and delinquency if any. A professional has all the necessary time and resources to dedicate to each account. They can get settlements a lot quicker and save you the most money possible. That way, you can spend your time doing what you love while they work to get you out of debt.
If you want to ensure that your accounts are in the right hands, you should hire a professional who has over ten years of experience and great reviews. They should also have a team of workers for best results as this process is time-consuming. The best professionals will have multiple accreditations, including the AFCC and the IAPDA. A reputable professional that has been in business for a while may have also built up relationships with credit card companies, which could work to your advantage.
The main benefit of negotiating a settlement with a professional is that overall, it shouldn’t cost you anything in the long run. A good professional will be able to help you save your time and money. Most companies’ fees are tied in with a low monthly payment similar to your current credit card payments or lower. By investing in a professional, you will likely pay much less money in the settlement too!
As a leading sales and marketing firm in Orlando, FL, Entelechy Management Inc. negotiates with your lenders to get them to settle your debt by paying less than the total amount you owe. The lowered debt amount is paid in a lump sum rather than a monthly installment. Our expertise and knowledge are at your disposal to negotiate bigger savings for you. In addition, we offer career opportunities in marketing across Orange City, Deltona, DeBary, Sanford, Lake Mary, Apopka, Altamonte Springs, Oviedo, Winter Park, Winter Garden, Clermont, Orlando, Doctor Phillips, Lake Buena Vista, Celebration, Kissimmee, St. Cloud, Davenport, and Poinciana, Florida.