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How do you know when to settle credit card debt and when to pursue a different strategy? The first thing that should be mentioned right off the bat is that your goal should always be to pay your credit card balance (and any other debts you may have) off in full. After all, paying off debts in full is the sign of a financially secure and financially responsible individual that will not only see a slow and steady increase in their credit score but also an increase in the amount of trust and therefore credit that they will be eligible to receive in the future.

That being said, stuff happens. Everyone understands that things can happen to cause a credit card holder to be unable to make their required minimum monthly payments. Whether it is in the form of a lost job, expensive medical bills, unforeseen expenses, or simply poor financial choices – these things happen.

Credit Card Debt Debt Goal Debt Consolidation Care

If you are to the point where you simply cannot continue under your current credit card debt load then it is important to remember that it is better for you and your credit card company if you can work out an agreement where the credit card company agrees in writing to settle your credit card debt for an amount lower than what you currently owe (and hopefully waive some of your past fees and penalties in the process).

Why is debt settlement better for the credit card company? Well, if it is indeed true that you simply cannot continue to attempt to pay off the current balance on your credit card then the credit card company would much rather get some of their money back then none at all.

Your goal in crafting your credit card debt settlement strategy is to convince the credit card company of just this: that is better for them to settle and receive some of their money back than receive none at all.

In a nutshell, it is best to settle credit card debt if you really have no other options aside from walking away from the credit card or beginning bankruptcy proceedings. Many credit card companies will work with you if you put in the effort to convince them of your desire to do the responsible thing and pay off the credit card to the best of your abilities.

Although mistakes and unfortunate circumstances can happen it is important to demonstrate to the credit card company that you have a strong desire to get back on your feet and do the right thing by paying off the card to the best of your abilities. Many times this proactive approach to your credit card debt will result in a willingness to work with you and not against you on the part of the credit card issuer.

Learn how to most effectively navigate the debt settlement process by reading through our guide on how to write a credit card debt settlement letter, check out the various free credit score monitoring services to stay on top of your credit score, and then take a look at our home page to research the various types of credit cards and learn all that you can about using credit cards responsibly.

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Disclaimer: This content is not provided or commissioned by American Express, Visa, MasterCard, Discover, or any other credit card company or issuer. The opinions expressed here are the author's alone, not those of any credit card company or issuer, and have not been reviewed, approved or otherwise endorsed by any credit card company or issuer. Credit Card Chaser may be compensated through various affiliate programs with advertisers. As always, Credit Card Chaser is an independent website commmitted to helping people research credit card offers and find the best credit card!

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Less than $2,500 More than $2,500
Always Never Sometimes