How to Reduce Credit Card Payments Without Damaging Credit

If you’ve fallen on temporary hard times, lowering your expenses probably sits near the top of your priority list. Before you panic, contact your credit card issuers to find out if they are willing to cut you a deal. Most major card companies offer hardship programs they don't advertise to the public, but company policies and terms vary. Since many credit card companies don't report enrollment in hardship programs as negative information to the credit bureaus, participation won't ding your credit score.

Call the customer service number listed on the back of your credit card. Explain you are currently experiencing financial difficulties and can’t afford the payments. Give the reason and ask to talk to someone who can help. Normally, the first customer service representative you talk to doesn't have the authority to lower the interest rate. Tell that person you need to speak to someone about a hardship or assistance program. A supervisor or account manager can usually give you more information about the different payment options available to you.

Ask about a forbearance program--a temporary program that can help you when finances get tough. This postpones your payments for up to a year or longer so you have time to improve your finances. Interest continues to accrue during that time, but you can ask for a lower interest rate. You aren't being charged late fees for the months you don't have to pay so your credit score isn't affected.

Inquire about other types of hardship programs. A short-term hardship plan reduces your monthly payment for six to 12 months whereas a long-term program gives you up to five years to pay off the balance. Many credit card companies will reduce the interest rate to zero percent for at least a few months. Try to negotiate a card rate of no more than 10 percent for when after the rate increases. Don't be shy about asking them to waive penalties and late payment fees too. The worst they can do is say no.

Talk to the card company before things get bad. In fact, call the creditor ahead of time to report that you're going to be late with your payment. You may be able to work something out before it affects your credit. Have your latest credit card statement and a list of your monthly expenses ready when you call.

Get the details before agreeing to new payment terms. You may have to enroll in an automatic bill payment plan. Some companies will also close your account permanently or until you pay off the debt. In this case, the FDIC recommends you request the card company note the account as "closed by consumer" on your credit report.


  • Calculate your debt-to-income ratio to see if you have leverage to negotiate with a credit card company for a lower card rate. Divide the total of your monthly debt payments by your gross monthly income. A ratio below 36 percent will improve your negotiating position. Anything above 36 percent and you're likely out of luck.
  • Use a FICO score of 720 or higher to give you more bargaining power. If your score is lower than that, point out you have a history of always making your payments on time.
  • Request any changes to your credit card terms in writing. Get the name and title of the person authorized to lower your interest rate, and write down the date and time of every exchange you have with that person. You may need the information if the rate isn’t changed.


  • Creditors handle hardship programs differently. Some creditors will report a hardship program that lowers your minimum monthly payment to the credit bureaus. The up side is the creditor will remove the entry from your credit report once you make all the payments as agreed.

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About the Author

Amber Keefer has more than 25 years of experience working in the fields of human services and health care administration. Writing professionally since 1997, she has written articles covering business and finance, health, fitness, parenting and senior living issues for both print and online publications. Keefer holds a B.A. from Bloomsburg University of Pennsylvania and an M.B.A. in health care management from Baker College.