How To Pay Off Your Credit Card Debt (Part 1)

Image Source: http://en.wikipedia.org/wiki/Credit_card

To read my post on How to Use Credit Cards, please click here.



How to pay credit card debt that has been delinquent:

When I finally felt I would no longer be able to maintain a good standing in all of my credit cards, I called up the bank and asked if they could discontinue my use of it and would just pay it all off by payment arrangement instead. They disapproved my request for reasons that weren't clear.

An office mate of mine advised me to stop paying it instead. Wait for some legal people to write me a letter and if they go to my house, just don't show up and make unending excuses. Anyways she said, that if i haven't been paying for months the bank would allegedly just file for bankruptcy at Banko Sentral, then Banko Sentral would pay them up. Allegedly these legal people who would soon harass me were paid to do just that and whatever money they'd get from me would be the commission they would earn. I didn't know if any of these were true and I didn't know who gave her that idea. Unfortunately, I heeded her advice given that she went through all those herself and actually got away with it.

Having left it just like that felt irresponsible but I was scared and I didn't know what to do. I'm not trying to sound holier than thou but it just felt wrong, that I know in my heart one day, it would haunt me. And it did. After 2 years, it finally did.

I read somewhere that one way or another, you'd have to face the consequence of not paying your credit card debt off. What's scary is the kind of situation you'll be in when it starts to haunt you. You see, your name will be included in the negative reference file used by banks and other financial institutions. When you're being searched or investigated, all banks would have to do is just see the list and see if your name's in there. It may affect your transactions to anything, I don't know maybe to your job hunting, to your plan of working overseas, to your house loans, I don't know where else.

In what I will share, I will name these 4 banks: Bank A, Bank B, Bank C and Bank D as the credit card companies I paid my debt off to detail each experiences I've had with them. That way if you're facing the same dilemma you would have a bigger picture of what you'll be presented with and of what to be done.

Since Bank A was the very first bank I had called, nangangapa pa ako. Be warned that your call would be passed on to many people before you get to talk to the one in charge of your account.

(Tip: ask for direct line so the next time you call, you will not go through all the pasahan anymore and make your call not later than 4:30pm, make sure you have your credit card number with you and you know what type of card you have with them)

Once you've talked to the right person, you will know if your account is still with the bank or have been endorsed to a 3rd party already. If he or she did not make it clear, ask. With Bank A I've learned that it wasn't with them anymore nung bayaran na. That time di ko pa alam nun na 3rd party na pala yung number na binigay sakin to follow up. I called up the agency, that was January and the negotiation started with them telling me that there was an "amnesty program" I could avail since it was Christmas time still. From my debt of 50k++ "daw" it would be reduced to half the amount and it'd be just a one-time offer they warned me. They gave me like 1 week to come up with the money and if I wouldn't be able to, madadagdagan na ng 1k every week na hindi sya masesettle. Guess what? I wasn't able to come up with that money on the said date at hindi nadagdagan ng 1k. All were just BS. To cut it short, I paid the amount in their preferred bank and I got the certificate of clearance a few days after. Bank A, done.

(Tip: if you're ready to settle your debt, opt for one-time payment. they will give you installment options but will be based on your actual utang (outstanding balance). Say for example they tell you, you owe them 60k, if you decide for one-time payment they'd probably ask you to settle 30k as full payment. if you opt for 12month, 6month or 3month installment, they'd have to base it with 60k. It's your choice although it doesn't sound like an option really.)

With Bank B, I decided to settle matters with them personally. When I got there, unfortunately I'd have to settle it daw via phone only. Since I was there na I used their office phone and had me connected to the one in charge of my account. The person-in-charge told me the exact amount I needed as full settlement, I was shocked na ganun lang kababa utang ko so I said I can pay it na that same day. She told me to settle it in their HO branch, meet her there and certificate of clearance will be given to me right there and then. When I got there, she counted the money, deposited in the machine herself and then gave me the certificate. Bank B, done deal.

(Tip: It became easy for me to settle this one maybe because it was still in the bank, I paid for what's just due without the other fees and many charges. So settle it straight away before they endorse it to another party. There's a credit card company I know that endorses it to a 3rd party if it reaches more than 90 days unsettled. I don't know with the others but I guess it's safe to guess your figure around the same number of days too.)

...to be continued (Click here for Part 2)