With unemployment persistently knocking the 10% benchmark, many Americans are struggling to pay back their debt. From credit card debt to student loans to mortgages, there are many bills that Americans don’t have the income to pay. Wisely managing finances and debts while unemployed can help accelerate the road to recovery and prevent unwanted problems.

Resolve Debt Without a Job

Fortunately, it’s possible to eliminate debt or solve your debt problem even without a job. By strategically managing your situation, you’ll be able to sustain a living while hammering away at any outstanding debts.

1. Determine and acknowledge all sources of income. Even though you’ve lost your job, it’s important to seek out all sources of income. Do you qualify for unemployment benefits? Or did you have a part time job on the side that you can still rely on for some cash? By listing all sources of income, you’ll be able to create a plan to eliminate debt.
2. Prioritize debts. Not all debt is created equal. Some debts have higher interest rates than others, and these will generally be the accounts that you want to pay back first. By prioritizing high-interest rate accounts, you’re saving money by eliminating the interest that would have accrued when you pay it off.
3.Debt negotiation. There are many variations of debt negotiation. Whether you deal with your credit card company, bank, or student loan lender, it’s possible to engage in debt negotiation. Now, you likely won’t be able to reduce the amount owed, but you can request for changes in repayment terms and even interest rates. Be sure to research how to deal with each of these entities appropriately and how to stress your financial situation and hardship. For instance, when pursuing debt negotiation with a credit card company, it’s important to write a hardship letter.
4. Continue sending payments. Continue sending any payments that you can. Don’t be tempted to wait or skip a payment just because you’re unemployed, unless you absolutely can’t make it and it would cause a hardship. By paying debt even when unemployed, you’re preventing damage to your credit score.

You signed up for credit cards to help you out of your financial situation, but now your cards have created a financial mess of their own. What are the possibilities to escape? Fortunately, credit negotiation is not as difficult as you might think, and if done properly can greatly alleviate your financial predicament. By taking an active approach to credit negotiation, you can accelerate the debt reduction process.

Credit Tips to Help You Regain Control

By taking advantage of these credit tips, you can positively influence your short-term and long-term financial health. Credit negotiation with your credit card company can impact your credit score as well as the amount that you owe in taxes. Consider these tips during your credit negotiation process.

1.  Collect a record of credit card offers. By keeping a collection of credit card offers and their interest rates, you can use this during the credit negotiation process to prove to your credit card company that you can move elsewhere if they don’t match competing offers.
2.  Ask for a supervisor. When you call a credit card company, the first person you’re going to speak with is going to be a customer service representative. Asking to speak with a supervisor is one of the most important credit tips because you will be able to speak directly with someone who can negotiate rates with you. Remember, the supervisors have more authority than normal representatives to change your rates.
3.  Document everything. If you’re able to successfully negotiate over the phone, try to document the time you called, who you spoke with, and ask for written documentation of the credit negotiation. If possible, try to record the conversation. This way, if there’s ever a dispute about the terms derived from the credit negotiation, your case is proved.
4.  Transfer your debt. If credit negotiation doesn’t work, then remember all those offers you collected from credit tip number 1? Transfer your debt to one of them. This is one of those credit tips that should only be employed if all else has failed.
5.  Ask for a forbearance program. If you’ve struggled temporarily but imagine yourself being more financially stable in a few months, a credit negotiation for a forbearance program might be the best choice for you. This offers you a few months to recover financially without having to worry about outstanding bills.

Thankfully, there are many options for unmanageable debt. While some people seek professional guidance from a debt counselor or a credit repair company, there are others who prefer to handle the situation themselves. By handling debt negotiation, you have the opportunity to bargain for your preferred terms on repaying your debt. Though debt negotiation doesn’t guarantee a perfect solution, you have the power to estimate how much you can realistically pay and offer less.

Negotiating with Collectors

Debt negotiation can be an extremely intimidating experience. However, debt arbitration or settlement shouldn’t feel so threatening if you keep our debt tips in mind.

1. Prioritize your bills. Focus your first debt negotiation efforts on the accounts with the lowest balances. After establishing communication and rapport with your creditors once these balances are settled, continue paying off the more costly accounts. This is one of the debt tips that keep your payments manageable while keeping your credit and reputation in check.
2. Make the offer. Many individuals make the debt negotiation mistake of asking their creditors the minimum monthly payment that they can make. Instead, check your own financial situation, determine how much you can afford to pay, and then make an offer. This assures that you can pay your bills no matter what happens. While your creditor might say no, keeping debt tips like this in the forefront of your mind keeps more power in your hands, which is the purpose of your debt negotiation effort.
3. Be patient. We’ve all dealt with them on the phone and know that they can be rude, but it’s crucial to stay patient and respectful in the midst of a debt negotiation. Keep the personal details of your life private and know the protections that FDCPA offers for you. Even if they initially reject your debt negotiation offer, you can always try in another month and they will be more likely to re-hear your case if you were polite the first time around.

As with any financial matter, one of our biggest debt tips is to keep a paper trail and record any conversations with your creditors. This prevents them from refusing to fulfill their part of the debt negotiation.

When dealing with a collection agency that is handling your debts, it is worth it to look into negotiating your credit rating. This credit negotiation can help you in the long run, and also help you to maintain relatively good credit, even when dealing with debt collection.

More on Credit Negotiation

One of the first things to negotiate with a collection agency is the removal of the listing from the collection agency from your credit record. Even a “Paid as Agreed” listing in your credit is a bad mark and can lower your credit rating. This simple step should be relatively easy for the collection agency and is no problem for them, but it can be a big help for you as credit negotiation goes.

If you’re not planning to dispute the listing through Method of Verification, contact the original creditor and have them change the listing to reflect that you paid it to the collection agency. Making sure that it is clear in your financial history that any debts have been settled is key to credit negotiation and making sure that your credit rating is the best that is can be after a debt settlement.

If you have to deal with a bad listing as part of your history, then you’ll need to negotiate what the mark to your history will look like. “Paid,” “settled,” “paid collection,” etc. – there are a variety of possible listings that can be put on your account and knowing the best one, relatively, is important.

If the creditor won’t delete the listing entirely, try for at least something like “Paid” or “Settled” on your credit listing, as these both show that you’ve paid your debts, or at least settled them, and they look better than something like “paid collection” or “paid late,” which can be just as damaging as the original debt to your credit rating.

Anyone who has dealt with credit debt knows that it is a difficult situation to overcome. Luckily, there are ways to negotiate away your credit debt through various debt management solutions. Knowing what debt management solution is right for you is key. Understanding the various options for credit negotiation out there, and what to look for in those different solutions, can help you dig yourself out of credit debt in no time.

Dealing with Debt

The easiest way to avoid these problems is, obviously, to avoid getting into them in the first place. Paying all bills on time and not incurring a lot of unpaid charges in the first place are the keys to maintaining a solid credit foothold. However, if you are already in a credit card debt situation and need to figure out the management plan that works for you, there are a variety of options out there.

You should consider counseling services, as these services will work directly with your creditors to help ease your financial problems. Many of these counselors are actually nonprofit as well, which means you can avoid incurring future costs and other potential debt.  Counselors can also help with credit negotiations, which will help you avoid incurring further debt.

In addition, counseling services will work directly with creditors to figure out a solution that’s right for you. In fact, many credit card companies actually encourage work with credit counselors to help ease debt problems and keep their debtors afloat. If you do go the route of credit counseling to help with your debt management, and provide help with credit negotiations, make sure your counseling service of choice is accredited. There are a number of organizations out there dedicated to accrediting counselors and making sure they are following the rules.

When it comes to choosing a company to help you with your debt relief efforts, there are many options available. However, variety doesn’t always  mean better in terms of quality. Before you hire someone to help with your debts, look for a few signs that indicate they are a qualified service provider.

Working Smarter

One of the things to look for first is the types of services offered. Ideally, you would want to choose a company that can offer a range of debt relief services like credit negotiations, budget counseling, debt management plan development. Choosing a company that only offers debt consolidation or settlement services could be an indication they aren’t the right one for you. It is important to find a company that can review your unique financial situation and discuss all of the options that could help you, not just one they want to “sell” you on.

Another key component is the type of people they staff. When it comes to handling your debts, and your money, having a well trained person is important. Many debt relief companies may staff people trained on the job or through a brief workshop. This should be a flag that you are not in the right place. Only obtain help from companies that staff licensed or accredited employees. More specifically, be sure the person handling your case holds a degree in finance, accounting or law; just as a debt negotiation lawyer.

Lastly, examine the fees charged for services. A company that requires you to sign a service contract or pay upfront fees could be a sign you need to find help elsewhere. Remember that you should never pay for services until they have been received. In other words, don’t agree to work with a company who wants you to pay before they have successfully resolved your debts with creditors.

Although many of us carry around a moderate to burdening amount of credit debt, most of us are unaware that we also have account rewards waiting to be cashed-in. In many cases, your credit card lender could owe you bonus points, or even have services to help you in a time of need that you don’t even know about.

Getting Clued In

Part of the appeal of many credit card offers comes by the way of bonus points, cash-back incentives, or other “rewards”. These incentives are based on your spending history and, often, your balance. Meaning the higher your balance, the more rewards you could earn. However, most people never even check their balance or cash in these rewards. From gift cards to popular retail stores or frequent flier miles, all the way to flat screen TVs, you could have some high value perks waiting for you. Be sure you are staying in contact with your lender about your reward balance. Chances are they aren’t advertising the fact they owe you something, and, if you were to end up in default or credit negotiations these rewards are likely to vanish.

Another overlooked area of credit card perks are offers that are unrelated to your actual spending history or balance. Many credit accounts come with hidden aspects such as purchase protection plans and extended warranty benefits. For example, if you were to purchase a new cell phone with your credit card, your account may cover the cost of repairs or replacement on that phone down the road. Other items like extended warranties on electronics may also be provided at no additional cost to you, when you purchase these items with your card. Always check the fine print of your credit accounts and make a point to know exactly what your card can do for you!

These days just about everyone has some level of credit debt. While credit debt can be a good thing, there is a fine line between credit boosting debt and credit destroying debt. The one thing about all credit debt is that it is negotiable, and you don’t even have to be suffering a financial hardship to get a better deal from creditors.

Let’s Make A Deal

There are two reasons you may want to negotiate with creditors, to make your payments more affordable or to save money. If you are under financial distress, credit negotiations can be a great tool for lowering your monthly payment and resolving the threat of default.  Credit negotiations can help you find an affordable payment through lowering the minimum payment requirement, waiving penalty fees, and even reducing the overall amount you owe. The key is to know what you can afford to pay each month before you contact your creditor to negotiate.

If you want to negotiate your credit card terms to save money, you may have a bit more of a challenge ahead. However, it is certainly far from impossible. Many lenders will be willing to lower your interest rate, raise your spending limit and even reduce your annual fees. All you have to do is ask. Of course, it helps if you have a good case to support your claim as a responsible borrower. Mention the fact you have never missed or been late on a payment, or at least for 6 or more months. If you pay more than the minimum payment or use an automatic payment draft, those are also viewed favorably by your creditor. Contact your lender and discuss ways they can reward you for your great efforts as a borrower.

If you are currently behind on your debts you may be waiting for that dreaded phone call from a debt collector. Although no one wants to deal with creditors, avoiding the issue is only going to make matters worse. The key to resolve debt collections can be found in a few simple steps:

Take the call. Avoiding debt collection calls is likely to lead to more serious collection actions like wage garnishment and credit damage. It is important to take at least one call so that you know the status of your debt accounts, where the creditor is in the collection process and find out what your options are.

Review your account. You don’t have to deal with debt collectors when it comes to your debts, but you do have the right to discuss your account directly with the creditor. Contact your creditor directly and find out what their plans are for collection and discuss possible repayment options.

Negotiate a solution. Credit negotiations aren’t as difficult as you would think, it just takes effort. You may be able to negotiate an extension on your payment schedule, a lower monthly payment or a temporary suspension from payments. All you have to do is ask.

Negotiating debts isn’t easy, which is why many people tend to shy away from the process. However, negotiating with your creditors can be the difference between being stuck under a giant debt load and possibly being forced into bankruptcy, or finding financial freedom from those debts. While the process may not be easy, it is possible with a little preparation and knowledge.

What You Need To Know

First and foremost, you will be told “No” at least once during your negotiations. Creditors loaned you money and they intend to get it back. While repaying your debts is your responsibility there are situations in which financial hardship strikes, but receiving help from a creditor is a gift and not a right.

Remember that credit negotiations is a back and forth communication that will require you to disclose information about your income and debts. You should be prepared to prove your financial hardship by sending copies of paycheck stubs, writing a personal letter regarding your situation and maybe even documents of events that preceded your financial hardship like a divorce or medical illness.

Even though creditors are owed their money, they do understand that they could be at risk of losing that money altogether in the event you file for bankruptcy. While threats of bankruptcy are not advised, you do have some leverage in your negotiations when keeping in mind that proving your intentions to pay some amount will go far. Know what you can afford and set it up on an automatic payment system. Creditors are often more willing if they know they have a guaranteed payment each month and will not have to wait on a check to be mailed.