Should You Apply for a Credit Card Assistance Program?
Households in the US on average have about $16,000 worth of credit card debt. Dealing with credit card debt can be difficult and stressful. It can also be hard to catch up on bills if you are experiencing a financial hardship or sudden medical expense. One little talked about option are credit card hardship or assistance programs. Wondering if you should apply for a credit card assistance program?
Keep reading below for all the information you need.
These assistance programs are offered to credit card holders going through difficult times like losing a job or illness. It’s a way to get payment relief short-term.
While specifics depend on the company, these programs generally provide temporary lower interest rates or waived fees. Many programs last either six or twelve months.
Be aware that these programs usually end if you miss just one payment or falter on other conditions.
Don’t act surprised if you haven’t heard of your credit card assistance program. These are not advertised or made public. To access the program, this means you must call and ask.
There likely will not be a number for the program, so prepare yourself to deal with a few transfers.
Ask Questions With Caution
When you call your credit card company, be careful when asking for information. Don’t give details of your situation until you feel comfortable with the information you have received.
This is because sometimes companies will change your account features just based on what you say. For example, if you say you are having trouble paying, they may lower your credit limit.
Provide information on how much you can pay per month realistically. Some companies may be flexible and work with you.
Freeze on Your Card
Before you make a final decision about using these programs, prepare to lose access to your card. While on an assistance program, your company will likely freeze the card.
This helps you focus on paying what you already owe and not adding to your debt amount. Even if you choose not to sign up for the program, freezing your credit card could be one way to start paying down your debt.
Impact on Credit
If you aren’t familiar with your credit score and details, make sure you do this before signing up for a credit card debt assistance program. This is important because using the program may impact your score.
Try to ask your company what the impact, if any, will be from participating. It may be difficult finding this out, as sometimes agents may not have all the information.
Some companies will report negative remarks to credit bureaus if you fail to make payments or dropped from the program. Don’t assume if you skip a month, they will understand.
Always call and explain politely that your situation has gotten worse.
Choosing a Credit Card Assistance Program
Regardless of the cause of your financial hardship, an assistance program may be the right thing for you. If lower interested and no fees sound helpful to you, be sure to contact your credit card company immediately for information.
Do you have additional questions or want to discuss your credit situation? Please contact us, and we will get right back to you!
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