One of my biggest fears when I found myself in financial trouble was calling the credit card companies up and telling them "Hey, you guys aren't getting paid this month!". I guess I didn't want to hurt my pride, or I didn't want to get yelled at. Whatever the reason was, it took a bit of courage for me to finally pick my phone one day and call some of my credit card companies and tell them I was running into problems.
Before I Missed Any Payments..
So what happend? Did I get yelled at? Scorned? Not really. The first time I called them, all of my accounts were for the most part, current. I asked if I could lower my payments, or interest, or anything, and was shot down by every company. Because I had a good history, in their eyes they figured that eventually I was going to pay because in the past, I never missed payments. I remember I spoke with about ten people from different creditors, and the closest thing I got was one of then (CitiBank) told me that if I couldn't make the whole payment, I should try to at least make some kind of payment.
After The First Missed Payment...
So I figured that after I missed a payment, I could call the credit card companies back again and explain that I was running into financial problems, and for some reason I figured they would want to do something to help me out.
Nope, everyone was still playing hardball. When I asked about hardship programs, I was told they weren't any. When I asked for reduction in my interest / payments, pretty much every creditor told me they didn't exist, when I knew that they did. I know credit card companies have to make money, but I tried to explain to them that there was going to be little chance of me being able to get financially better before things would get worse. Their response? Oh well,
Two Missed Payments...
Things started getting a bit creepy after two missed payments. I started getting letters in the mail.. but these weren't threatening letters. Some of the credit card companies got the message that I wasn't going to pay them, and sent me letters saying they understood people have financial problems and want to help me out.
So I started calling the creditors back, and sure enough after two missed payments, most of the credit card companies started opening up about hardship programs, and interest reduction, They listened to my problems and most actually wanted to help out at that point.
Does It Help To Call Your Creditors?
In my experience, it really didn't help to call any of them until after they contacted me, or I missed two payments. If you have a nice track record of making payments, they aren't going to help you until they know you are in actual trouble (and that's by getting your credit score screwed with late payments).
If you're still ahead of your bills, but barely holding on, the only thing you'll get out of calling your creditors is a waste of your time.
Why Shouldn't You Call Your Creditors When Having Financial Problems?
One credit card company wasn't willing to help after my first call. But within one week, I received a letter in the mail from them stating that they had reviewed my account and reduced my credit limit to about $10 above my (then) balance.
Although I wanted to take control of my credit situation, I was still planning to use that card to pay my car insurance bill. I'm pretty confident that it was that particular phone call that triggered them to reduce my credit limit, considering I was only using using about 30% of my credit limit, and had not heard from them (besides statements) in over four years.
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