Almost every adult in this country has credit card debt. Some only have a few hundred dollars of debt, while others have thousands of dollars of debt. Either way, there may come a time when it becomes extremely difficult to pay even the minimum amount that is due. The economy continues to be unstable and this means that it is possible that you may need some sort of debt relief, such as a lower monthly payment for a short period of time. This is something that credit card companies are very familiar with.
Why Credit Companies May Agree to Help
In most cases, credit card companies usually agree to work with people in difficulty because the alternative for the debtor is to request bankruptcy, which means the credit card company gets nothing. Hence, it is better to write a hardship letter, in which you tell the creditor about your financial situation. This will also stop them from harassing you, and it will give you a chance to protect your credit rating. It is not, however, a way to get out of your debt.
If you can prove hardship, the credit card company will usually help, for instance, by lowering interest rates and suspending any late payment fees. They will, however, also want you to stop using your credit card. Additionally, they want to see you make every effort you can to repay your debt. Hence, do make sure that you tell them how much you are willing to pay each month, and when you expect your hardship to be over.
Steps in Writing a Hardship Letter to Credit Card Company
- Make sure that you write your letter formally. Place the name of the company at the top of the page and date it as well. Place a reason line below this, and make sure your credit card account number is included as well.
- Write your first paragraph, in which you explain that you are asking for help and you tell them why you are in hardship. For instance, you may have been made redundant, or you may have had an unexpected huge medical bill. Be honest and open, but keep it short and to the point.
- Explain how you aim to rectify the situation. Tell them how much you are able to pay instead of your regular bills. Do not put more in that figure than you can afford. If you can only afford a dollar a week, then tell them and don’t say you can afford $10 a month even if you can’t. At the same time, don’t offer them less than you can afford either. They are likely to want to see a financial statement from you, so they will know if you can pay more than you are offering.
- Tell them when you expect your hardship to be over and what you aim to do about your outstanding debt at that point.
- Thank them for their consideration and ask them to contact you as soon as possible with their decision.
While there is no guarantee that your credit card company will agree to your request, most will accept it because it means that they will be able get what is owed eventually.
For more sample hardship letters, click here.
Hardship Letter To Credit Card Company Example
{Your Name}
{Your Address}
{Your Phone Number}
{Date}
RE: request for {consolidation/restructure} of loan for {VISA, Mastercard, etc.}, account {account number}
To Whom It May Concern:
I am writing to request the {consolidation/restructure} of my credit card repayment, due to financial hardship.
The current balance on my credit card is {amount in dollars}, and I have been paying {amount in dollars} every month for {length of time}. This had been an adequate system, until recently, when I fell on hard times.
Due to {death in the family, divorce, medical problems, etc.}, which began {date}, I have been unable to keep up with the payments. I have attached {list of financial documents attached}, which should illustrate exactly why I am in need of your help. I am accruing more and more in the way of late fees and finance charges, which means my balance just continues to increase, and there is nothing I can do about it.
I am requesting {consolidation or that the company accept a certain amount that is less than the total due}. I am extending the same offer to other creditors, so that I can avoid filing for bankruptcy.
Please contact me as soon as possible so that we can get the ball rolling on this situation.
Sincerely,
{Sender Name}