Last week I was talking about pulling and checking your credit reports. Now that you’ve done all of that, it’s about time to see what you can do about the credit items listed. Hopefully you’ve disputed or are in the process of disputing any incorrect information.
If you have any credit items that have a high balance, or are 30 or more days past due (and they’re being reported correctly), you can typically work with the original creditor to negotiate a payment plan. This doesn’t always work, but it’s worth a try. D was able to negotiate the payments on an old medical debt, and for that they arranged to delete the negative information for payment in full of the debt (which they actually agreed to take less than the actual amount owed).
Also, more often than not you’re not getting the best interest rate that you can get. It’s also worth trying to negotiate a lower interest rate with your credit card company. I called my credit card company in November to see if I could negotiate my ugly looking 11% interest rate down. I wasn’t expecting much if any change, but I was able to bring the rate down to 7.2%. It’s not the best rate ever, but it does lower my minimum payment down to a nicer looking level. I plan to have that card paid off in the next four months, so I’ll be one more step closer to debt free.
So pick up the phone and communicate with your creditors. It may just be one of the best things you can do.