Struggling with debt?
You’re not alone.
You have options to get back on track.
BEST OPTION
YOUR CREDIT CARD COMPANY
ANOTHER OPTION
NON-PROFIT CREDIT COUNSELING
Many people struggle with debt.
Life is expensive and it can be easy to find yourself in a place where you can’t afford your credit card bills.
Credit card companies recognize that times are changing, and that life can sometimes throw you a curveball. Many companies have programs specifically designed for consumers that can't make ends meet.
When you're feeling overwhelmed, contact your credit card companies directly and see if they can help.
Debt is a tough situation,
but here are some options to get back on track.
BEST OPTION
YOUR CREDIT CARD COMPANY
ANOTHER OPTION
NON-PROFIT
CREDIT COUNSELING
KNOW THE RISKS
DEBT SETTLEMENT COMPANIES
YOUR BEST OPTION
Contact your credit card company.
The Consumer Financial Protection Bureau recommends contacting your credit card company or financial services institution directly - they want to help. They can often provide a safer and faster solution than other options.
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Credit card companies can often offer a similar, less expensive solution to debt settlement companies.
In addition, they can provide helpful information to get you through hard times:
How to create a budget
Strategies for paying off debt
Hardship programs to lower monthly payments
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A hardship program, also called a lender workout, is an agreement between you and your bank to help address the situation, for example by lowering your monthly payments.
If you qualify, this is a plan to repay your principal amount with less interest and fees.
It can help protect your credit score.
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No, calling your credit card company will cause no harm.
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Call, chat or visit your creditor’s website for immediate debt relief information.
Call the number on the back of your credit card or visit your creditor’s website for immediate debt relief information.
MYTH
Some may believe your credit card company only cares about getting their money back.
FACT
Your credit card company wants to keep you as a customer long term, and it’s in their financial interest to set you up for success.
ANOTHER OPTION
Work with a non-profit credit counselor
It can be confusing to figure out your options, so talk to a trusted expert. Reach out to an accredited, non-profit credit counselor. They can negotiate with your creditors on your behalf and help you budget and manage multiple debts.
What is credit counseling?
Non-profit credit counseling agencies can work with you on a debt management plan that allows for one monthly payment across your creditors.
They negotiate with your creditors on your behalf.
They usually offer free educational materials and workshops.
They provide a holistic solution including lower interest rates in addition to payment plans.
Credit counseling can help protect your credit score.
Credit counselor resources:
InCharge Debt
Solutions
Provides free and impartial debt relief solutions
National Foundation for Credit Counseling
30M people served since 2006
Financial Counseling Association of America
Offers free financial calculator
KNOW THE RISKS
What you need to know about debt settlement companies
If you are considering a debt settlement company, you need to know it can come with serious risks and potentially make your financial situation worse.
The Consumer Financial Protection Bureau warns:
“Debt settlement may well leave you deeper in debt than you were when you started.”
What is a debt settlement company?
Debt settlement companies – also called debt relief or debt adjusting companies –are for-profit companies that use aggressive advertising and sales tactics to convince you that you’re getting the best “deal.”
Often you could get a similar “deal” or solution by talking directly to your credit card company or financial institution, according to the Consumer Financial Protection Bureau.
The serious risks of working with a debt settlement company
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There is an increased risk working with a debt settlement company that your overall debt will increase and potentially increase your taxes.
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Working with a debt settlement company can damage your credit score for up to 7 years, which can sometimes prevent you from getting a mortgage or car loan.
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Debt settlement companies may not resolve all your debt. In fact, the debt settlement company industry itself concedes that 25% of their clients do not settle any accounts.
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Debt settlement companies charge big fees and could for a long time. Don’t fall prey to companies that charge fees up front, which is unlawful.
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The Consumer Financial Protection Bureau’s research shows that some credit card companies may refuse to work with debt settlement companies or may bring lawsuits after being contacted by a debt settlement company.
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Working with a debt settlement company can be a confusing, lengthy process. Also, you often lack transparency and don’t know how money is being used.
Did you know the Telemarketing Sales Rule protects you?
It’s illegal for debt settlement companies to charge upfront fees.
Debt settlement companies must disclose certain information before signing people up for services.
If you have already started working with a debt settlement company, it may not be too late to change course.
Contact your credit card company today.
MYTH:
Some may say debt settlement companies are the easiest and fastest option to get out of debt.
FACT:
Debt settlement companies could make your financial situation worse by charging you more fees that add up over time. Working directly with your credit card company is often the fastest and safest way to get back on track with paying your debt.