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how to lower my payment

i have 24000 to amex i am behind one month the closed my account and now want to sent it to collections they offered me a repayment plan of 1300 a month for 24 months is there any way of getting them to lower this

Posted from: Alberta

One Response to “how to lower my payment”

Barton Goth – Goth & Company Inc. -Trustee in Bankruptcy said...

There are a few things that can be tried.

First, you could simply try to negotiate payment terms directly with your amex rep or the collections officer. Whild this may work, often they are not willing to be very flexible.

Second, you could try to obtain a Debt Consolidation Loan. Essentially you approach a bank or other lender and apply for a loan to repay all of your existing debts. The advantage of a consolidation loan is that the interest charged is generally significantly lower than credit card interest rates. If you apply for a consolidation loan at a bank and your application is turned down that means the lender thinks you have accumulated more debt than you can reasonably be expected to handle.

Third, you can look into the Orderly Payment of Debt Program with Credit Counseling Services of Alberta. This is a voluntary program where your debts are pooled together (they aren’t actually paid off) so that you are only required to make a single monthly payment to a non-profit counseling agency. As you make your payments the agency forwards funds to each of your creditors in proportion to your total debt. The advantage of this procedure is that the interest is fixed at 5%, and while you are required to repay 100% of what you owe, due to the reduced interest your monthly payment is much lower than all of your minimum payments would have been without the plan.

The fourth option to reduce the monthly payment is to consider offering a formal Proposal to your creditors (also called a Consumer Proposal). This solution is used by people who cannot afford (or get approval for) a consolidation loan or a credit counseling plan, but don’t want to file bankruptcy. In a proposal you offer to repay a portion of the debt that you owe. Proposals are an excellent alternative to bankruptcy, but they are not well known so if you would like to know more details about a proposal feel free to contact me directly.

This is a summary of the typical options to lower your monthly payments. Should you need more information on these you are best to contact either your bank, Credit Counselling Services of Alberta or a local trustee for more information on the above.