If your credit card debt has become overwhelming and you know you have no ability to pay off the entire debt, you are advised to opt for debt settlement. In fact, you can settle your debt on your own without the assistance from any professional settlement companies. What you need to do is to refer to this 60-second guide for better understanding.

0:60 Get yourself mentally ready for debt negotiation. You must be fully aware that negotiating with creditors needs a lot of patience and time.

0:50 Make your preparation by getting all the supporting documents on hand. You need to ensure that you have all the latest credit card statements on hand. At the same time, total up all the outstanding balances and list down all the different interest rates.

0:40 After knowing your total debt, you are advised to assess your financial position. You need to work out a budget by including your monthly income and all the necessary expenses. Find out how much cash you have on hand. This is important as you need to propose a settlement amount based on how much you have. If you don’t have any fund in your account, be frank, you can stop considering settlement because you will definitely fail.

0:30 Once you get yourself mentally and financially ready, then you can start making call to your creditors. If you have less confidence, you are encouraged to prepare your script first.

0:25 Start your telephone conversation with your creditors. You are reminded to speak to a supervisor or department manager from the credit department. Make sure the person whom you talk to has the authority to make decision. Before making your proposal for settlement, it is necessary for you to explain in brief the financial hardship you are currently having. It is indeed important to convince your creditors that there is a need for you to settle your debt.

0:15 Be prepared that your offer may be rejected entirely or counter offer will be made by the creditors. Don’t give up easily. Wait for another one month and start calling your creditors again. The whole negotiation process may take few months before it can come to a conclusion.

0:10 Write a settlement letter to the person in charge after both of you have come to an agreement verbally. Be very specific in regards to the settlement amount you will be paying and the particular date for the payment. At the same time, send a request to them to update your credit file after payment is made.

0:05 Wait for the written agreement from your creditor. Without the agreement, don’t pay any single cent to the creditor. Once you have the agreement with you, you can make your payment to the creditor.

0:00 After payment is made, follow up closely with your creditor to make sure that the creditor updates your credit file by reporting it as “paid”.

Now, you can be completely debt free and you will have zero balance on your credit card statement.