We used a Credit Card Hardship Program to Become Debt Free.

“We’re Debt Free Thanks to credit card hardship programs

Credit Card Hardship Programs: – You Have Two Options To Consider 

A. Work directly with your bank. (Bank of America, Chase, Discover, Citibank, Navy Federal and Capital One Credit Card Hardship Programs All Exist)

B. Use a Credit Card Hardship Program outside the bank, like at Golden Financial Services

Today we will examine each type of credit card hardship program (Pros and Cons included) and give you the steps to get approved for whichever option you choose. Along the way we include “Pro Tips” — these are tips from the Golden Financial Services Debt Relief Experts.

PRO TIP #1: Since a bank’s financial hardship program is only a temporary fix and often doesn’t result in significant savings — it’s highly recommended to check with an IAPDA Accredited debt relief company on what they can offer to resolve your credit card debt, compared to what the bank offers you.

IAPDA Certified to help consumers that have a hardship with resolving their credit card debts.

IAPDA Certified Counselors at Golden Financial Services can give you a free savings quote on each credit card debt hardship program — Call Toll-Free 866-376-9846

Summary of what will be discussed & provided on this page:

A. The PROS and CONS of Each Credit Card Hardship Program

B. How to Qualify for a Credit Card Hardship Program

C. Compare Bank Financial Hardship Programs VERSUS What a Debt Relief Company Can Offer 

D. How Each Credit Card Hardship Program Works

E. Free Budget Analysis Worksheet — Helps you get approved for a credit card hardship program through your bank.

F. Free Debt Calculator Tool —  Gives you a quote on each credit card hardship program.

G. Financial Hardship Letter Template Included — Send this letter to each of your creditors, illustrating your financial hardship.

Bank of America, Chase, Capital One and Discover Credit Card Hardship Programs

If you have a financial hardship, the bank may either;

A. Temporarily reduce your payment.

B. Temporarily lower interest rates.

WARNING: Unfortunately, bank credit card hardship programs are only a temporary fix.

PRO TIP: A debt relief company can provide you a permanent fix.

What is a Financial Hardship? (See Examples)

Examples of a Financial Hardship - You need a financial hardship to use a credit card relief program through your bank.

There is no set income amount banks use to consider whether or not you have a financial hardship. If there is a set number the banks don’t fully disclose it.

So here’s the trick…

Qualification Guidelines: (for Bank of America, Chase, Capital One, and Discover Credit Card Hardship Programs)

To Qualify for a Credit Card Hardship Program You Must Be Late on Payments - but when does it get reported on your credit that you are late? This image gives you the answer to that question.

STEP ONE: (Must be delinquent, but not to the point where it affects your credit report)

PRO TIP: Don’t call your bank requesting to get on their financial hardship program until 7-15 days after you miss a payment. Don’t worry, it will not be reported on your credit report as a “late payment”. Late payment history doesn’t get reported to the credit reporting agencies until you are more than 29 days past due. SEE IMAGE ABOVE

WARNING: Keep in mind; just because the late payment wasn’t reported on your credit report, you will still be charged a “late fee” after being late on your monthly payment.

PRO TIP: If you call your bank requesting to get on their credit card hardship program after 7-days of being late and they refuse to work with you, hang up the phone and try again in a week. Also, request to speak to a Supervisor, and ask for a “Financial Hardship Program“. Your credit card company will then ask you a series of questions including:

  • Firstly, they ask you; “How long you anticipate the financial hardship to last?” (Say 6-12 months)
  • Secondly, they ask you; What caused your financial hardship? (You must be extremely detailed and include proof — we explain more on this below)
  • Thirdly, they will ask questions pertaining to your income. (Here’s where you need to be the most organized)

WARNING: Don’t call the bank about a credit card hardship program until you have completed a budget analysis and sent it to them. (We provide you the budget analysis template to use in STEP THREE — so it’s easy for you to create a budget)

STEP TWO (Send Financial Hardship Letter to the Bank) — Sending the credit card company a copy of your budget and a financial hardship letter — only strengthens your case and improves the chances of getting approved for the lowest monthly payment. This is not a required step, but it’s a smart step that Golden Financial Services advises consumers to take. Fax, email or physically mail the credit card company a copy of your financial hardship letter and budget analysis, prior to calling them.

When you finally call the bank about their financial hardship program you can start the conversation by asking them to verify your hardship letter and budget analysis was received. You will likely be more prepared than they are if you follow these instructions, and hopefully catch them stumbling around.

Chase Financial Hardship Program Letter Template (CLICK TO USE IT)

Capital One Hardship Program Letter Template (CLICK TO USE IT)

USE THIS CREDIT CARD HARDSHIP LETTER TEMPLATE FOR ALL OTHER CREDIT CARD COMPANIES: (COPY AND PASTE FROM BELOW AND SIMPLY REPLACE THE “EXAMPLE HARDSHIP EXPLANATION” WITH YOUR OWN FINANCIAL HARDSHIP)

Your Name

Your Address

City, State, and Zip

Date:

Name of Creditor

Creditor Address

City, State, and Zip

Reference to: Financial Hardship Account Number xxxxxxxxxxxxxxxx

Dear (Creditor Name),

This letter is intended to inform you about my extreme financial hardship, in the hope, it will further my chances of temporarily reducing my monthly payment to an affordable amount. I have exhausted all avenues of income and eliminated all unnecessary expenses in my life. At this point, I only have $105 remaining at the end of the month after paying all my other expenses. Please see the attached budget analysis worksheet illustrating these details.

Here is what happened… My husband recently divorced me. (I’ve included a copy of my divorce paperwork with this letter for your verification purposes)

He paid most of the mortgage over the years when we were married. So after the divorce, I started renting an apartment. The rent is $1,200 per month and my total income is only $1,950 per month.

On top of that, my wages just started being garnished by the government (8 days ago), for my $86,005 in federal student loan debt. I even included my monthly statement for the student loan debt so that you can verify these details are all true.

Next year I will graduate college, and I already have a job lined up, where I’ll be working at my friend’s Deli and earning $12.50 per hour. If you could kindly reduce my payment to $75 per month and waive the late fees, I would be able to continue paying you over the course of this year. In 13-months from today, you can raise the payment back up to what it was. If you don’t work with me, I will be forced to file bankruptcy and I really don’t want to go that route.

If you require any further information, I can be reached at Phone Number or at Email Address.

Sincerely,

Your Name

Signature

Date

 

PRO TIP: Try to be very detailed in your financial hardship letter and provide proof of as much as you can even if it seems like an irrelevant item.

STEP THREE: (How To Create Your Budget Analysis and Prepare To Call Your Creditor)

CLICK THIS LINK TO PERSONALIZE AND CREATE YOUR OWN BUDGET ANALYSIS

When you call the credit card company they may ask you to read them your financial figures (the ones inside your budget analysis) one by one over the phone. First verify that they received your budget analysis and hardship letter (as explained in STEP TWO). You may at that point send it again directly to the representative that you are speaking to, so make sure you have a computer or fax machine nearby when calling or have everything already scanned on your computer so that you can quickly email it over.

Bank of America, Discover, Capital One & Chase Credit Card Hardship Program Budget Requirements:

Again, there is no set number. What you need to show the bank is that you have very little money left over at the end of each month. The credit card company will start asking you questions such as; “What is your monthly income?”, “How much do you pay for your rent, mortgage, car payment, student loans, electric, groceries,” etc…

PRO TIP: If your credit card minimum payments add up to $500 per month, you need to show the bank that you only have around $250 per month left over after all of your other required monthly expenses are paid (excluding your credit card payments.)

The bank should approve you for their credit card hardship program where your monthly payment gets significantly reduced.

WARNING: If you show the bank there isn’t any money left at the end of the month, you will get denied for their financial hardship program.

The credit card companies enter everything into a computer system, so if their computer system shows you have insufficient funds to make a payment you won’t be eligible for their hardship program. Bank of America, Discover, Chase and Capital One all have very similar credit card hardship program requirements.

PRO TIP: Whatever your current credit card payment is,  you need to show the bank that you only have about half of that amount available after everything else is paid. You can’t show too little income, or too much income — or you will be denied for their program.

Disclosure: The banks have a mind of their own and they don’t disclose their eligibility guidelines for the credit card hardship programs. This information that we are providing is just professional advice to improve your chances of getting approved for the bank’s hardship programs, but there is no guarantee that even these strategies will work because we don’t work for the bank.

The Downside to Credit Card Hardship Programs When Working Directly with Bank of America, Discover, Chase and Capital One 

  • It’s Only Temporary: Payments and interest rates may only be reduced temporarily, and will then go back up.
  • It’s a Small Reduction: You will only get a small reduction in your payment or interest rate.
  • Lowers Credit Score: In most cases, you must agree to close-out your credit card, which will also lower your credit score.
  • Pay Entire Balance Plus Interest: You must pay back the full balance plus interest with a bank debt hardship program.

PRO TIP: If you’re looking for a bigger reduction in your payment and for a permanent fix — a credit card relief program at a debt relief company will be your best option.

Talk To An IAPDA Certified Counselor Toll-Free 866-376-9846

What is a hardship program for credit cards at a debt relief company?

Credit card hardship programs for credit cards include debt settlement, consumer credit counseling, debt consolidation and debt validation.

These programs are used to;

A. Reduce interest rates

B. Reduce balances

C. Consolidate monthly payments into one

Try this Credit Card Hardship Program Debt Calculator (FREE TOOL)

 

Debt Calculator

Calculate Again
Enter your total debt
punctuation marks are not required

Debt amount must be greater than $7,500!
Interest percentage*

Enter value of 0 to 99.99%
Type a monthly payment you can afford to become debt free
punctuation marks are not required

is your minimum monthly payment for total debt!
* Put the average interest rate that you are paying or that you were paying on your accounts. This will be used to calculate how much you would end up paying when staying current on your accounts. The interest rate that you put in here, will not effect the figures that are calculated for the consumer credit counseling and debt settlement programs.
Calculate Debt
#Debt ValidationDebt SettlementConsumer Credit CounselingOn your Own
Total Unsecured Debt
Time to Pay Off
Interest rate0%0%8%
Monthly Payment
Total Pay Back

Get a debt validation program quote!

 

What Golden Financial Services Credit Card Hardship Programs Can Do For You

— Get One Affordable & Easy to Manage Monthly Payment to Resolve all Debt

— Resolve Debt in 18-36 Months on Average

— Reach your goals of achieving debt freedom, saving money and improving your overall financial health

Talk To An IAPDA Certified Counselor Toll-Free 866-376-9846

Consumer Credit Counseling Programs to Help With Credit Card Hardships

Consumer Credit Counseling is a credit card hardship program that reduces interest rates. Once you are approved the company will take-over dealing with your credit card payments. You will have to pay the consumer credit counseling company one payment per month and they will pay your creditors out of that payment each month but at a reduced interest rate. These plans will get you out of debt in under 5 -years on average.

PRO TIP: Only use a non-profit consumer credit counseling company.

Benefit of Consumer Credit Counseling

A. Have only a single payment each month.

B. Interest rates are lowered after joining on this type of credit card hardship program. It is common for a person to have a 30% interest rate, lowered to 8%.

C. Less of an initial impact on credit, when compared to debt settlement and bankruptcy.

Downside to Consumer Credit Counseling

A. Your program payment will be close to what you’re paying when paying only minimum payments on your own. This is often what prevents people from qualifying for a consumer credit counseling program. They can’t afford it. Consumers with a hardship are usually looking to drastically cut their monthly payment and get out of debt fast.

B. This type of program will last for close to 5-years, which is longer than the average length of a debt negotiation program.

C. You will pay back the full amount owed and interest.

D. A consumer credit counseling (CCC) mark goes on your credit (often creditors look down upon this type of mark on your credit report)

Debt Settlement as a Credit Card Hardship Program

Debt Settlement Services (Debt Negotiation & Arbitration are synonyms) – debt settlement is a popular option for a person who has an extreme hardship and has fallen behind on their payments. This is a great alternative to bankruptcy.

PRO TIP: Before settling a debt, use debt validation to challenge its validity. (Below you can read about debt validation)

Benefits of Debt Settlements

A. Debt-free in 42 months or less.

B. Payback less than the total balance owed. Your debts will be negotiated down to a fraction of the balance owed — and then settled and satisfied.

TRY FREE DEBT SETTLEMENT PROGRAM CALCULATOR 

Debt Calculator

Calculate Again
Enter your total debt
punctuation marks are not required

Debt amount must be greater than $7,500!
Interest percentage*

Enter value of 0 to 99.99%
Type a monthly payment you can afford to become debt free
punctuation marks are not required

is your minimum monthly payment for total debt!
* Put the average interest rate that you are paying or that you were paying on your accounts. This will be used to calculate how much you would end up paying when staying current on your accounts. The interest rate that you put in here, will not effect the figures that are calculated for the consumer credit counseling and debt settlement programs.
Calculate Debt
#Debt ValidationDebt SettlementConsumer Credit CounselingOn your Own
Total Unsecured Debt
Time to Pay Off
Interest rate0%0%8%
Monthly Payment
Total Pay Back

C. Clients are set up with a single monthly payment, making it feasible to manage their debt payments.

D. Only pay after you get results.

Here is how the settlement process works:

You make one affordable monthly payment that we set-up for you based on your budget and other circumstances. Each month your money will be deposited into your trust account — that is solely in your name. You remain in control of the funds at all times, until your creditor gets paid. As money accumulates, we start negotiating. Immediately after we get one of your creditor’s to agree to reduce the total balance on a particular debt you will be notified of the offer and must either deny or accept it. After you accept it — your creditor gets paid directly from your trust account and reports the debt “paid in full” or “settled in full”. It’s an extremely effective program.

You only pay if results are achieved!

Talk To An IAPDA Certified Counselor Toll-Free 866-376-9846

Golden Financial Services has been in business since 2004, is A+ rated with the Better Business Bureau (BBB) and Accredited Members of the International Association of Professional Debt Arbitrators (IAPDA). Golden Financial Services can help you to rebuild your credit score after you graduate on the settlement program. While you are enrolled in the program you will learn about the Fair Debt Collection Practices Act (FDCPA) to help you identify if a creditor ever violates your rights, and if they do we will refer you to an attorney to help you sue the creditor. This will empower you with the knowledge that everyone should have, about debt collection and your consumer rights. To learn more about debt settlement services visit here.

Downside to Debt Settlement

A. There will be an initial negative impact on your credit score after joining the program.

B. Your creditors can harass you and even issue you a summons. (you will be referred to an attorney for legal protection if this was to happen).

C. The IRS considers your savings as taxable income. (clients will use a special form to show they are insolvent and aren’t required to pay the tax)

Your creditors will be contacted and directed to contact your new customer service team once you become a client, rather than calling you.

CLICK HERE – TO GET AN ONLINE DEBT RELIEF SAVINGS QUOTE 

Debt Validation to Dispute a Bad Credit Card Debt

Finally, the preferred debt relief option is debt validation.

Debt validation uses federal laws to challenge debt collection companies, forcing them to validate your alleged debts.

In 2016, debt validation was the most effective program and the least expensive route to resolving unsecured debt collection accounts.

Although you aren’t paying the debt back, if a debt collection company can’t prove that they are legally authorized to collect on it — you don’t have to pay it. Credit repair is then included to address the inaccurate and negative marks on your credit report. Once the debt is proven to be invalid, the debt collection company can no longer report the debt on your credit report.

Before you settle a debt, let’s challenge it. Make sure your creditors are abiding by the laws before you pay on a debt collection account. If they are abiding by the laws, maintaining accurate records and documentation — then we can settle your debt for less than the full balance owed.

Talk To An IAPDA Certified Counselor Toll-Free 866-376-9846

How does Freedom Debt Relief work?

Freedom Debt Relief is a debt settlement company. Debt settlement programs require you to permanently stop making payments to your creditors, and by doing so your credit report can be severely negatively impacted. On the positive side, debt settlement programs can reduce your balances and get you out of debt in around 42 months or less. Continue reading about debt settlement services by visiting this page next. 

Freedom Debt Relief Vs. Golden Financial Services

As we just discussed, Freedom Debt Relief offers debt settlement services without credit repair. Golden Financial Services offers debt settlement services, debt validation services, debt consolidation services and some programs come with credit repair. Golden Financial Services offers more options, compared to Freedom Debt Relief. If you visit the Better Business Bureau (BBB.org) and check out Golden Financial Services and Freedom Debt Relief Relief you will find both companies have an A+ rating; However, Golden Financial Services has zero customer complaints and Freedom Debt Relief has 304 customer complaints.

If you have a financial hardship, credit card relief programs can save you from letting the situation get out of control.