If you are one of the millions of Americans out of work, and your cash flow has been impacted dramatically, there are several things you should do especially if you are carrying large credit card balances.
If you know you will be going delinquent on your payments, you should stop using your credit cards immediately, except for one that you will need in case of emergency.
It’s important to contact the remaining credit card companies to let them know your situation and that you will need some relief from your payments due to your employment situation. In the current economy, there are thousands of people defaulting on their credit cards and going bankrupt. When you show that you want to do the right thing and work with the issuer to come up with a solution to your problem, the issuer generally will do all that they can to help you.
Your creditors may suggest that you work with a local credit counseling firm. This is in their interest because those companies receive a portion of their fees on an annual basis from the issuers, along with whatever fee you would be paying them for their service. Asking them for a settlement probably won’t be helpful, they generally do not do this until you are severely delinquent and they have exhausted other resources, such as consumer credit counseling.
The important thing is to get in front of your debt problem. Don’t wait until you are overwhelmed. By that time your choices become more limited, you will most likely be recieving numerous collection calls, and maybe even threatened with lawsuits.
You are more in control than you might imagine if you start early, recognize the problem and deal with it.