As one of the largest debit and credit card issuers in the country, Citibank deals each year with hundreds of thousands of folks who struggle with massive credit card debt. If you’re cutting your expenditures like crazy and still barely making the minimum payment on your Citibank credit card each month, it may be time to begin negotiating a settlement on your account.
Whereas typical credit card settlements can absolve cardholders like you of up to 60 percent of the outstanding balance on each account, no experience is typical. According to folks who have been through the process in the past, Citibank credit card settlement can be unusually difficult due to the bank’s sharp negotiating style and its unwavering insistence that cardholders adhere to its rather strict due dates for payments and paperwork filings.
Large banks and credit card issuers build a loss buffer into their business plan, accepting that a certain percentage of their customers will eventually be unable to pay off their balances in full. Depending on the bank, this “delinquency percentage” can be as low as three percent and as high as 10 percent. Of course, it can go even higher, but delinquency rates higher than 10 percent of all credit accounts generally lead banks to tighten their lending practices to avoid debilitating defaults.
Among these large national creditors, Citibank is well known for its aversion to high delinquency rates. The company keeps its cardholders on a short leash, especially when they approach their credit limits or miss minimum monthly payments on more than one occasion. If you’ve fallen behind on your Citicard payments, you’ve likely been contacted and asked about your plans to repay your debts.
The Citibank credit card settlement process can be nervewracking if you owe the company a substantial debt. If you’ve settled debts with other credit card companies, the process has likely been tense but ultimately amicable, progressing from a frank conversation about your ability to continue making purchases on your credit card to a reasoned discussion of about how much of your current balance you’d be able to pay off over a reasonable length of time.
These conversations lay the groundwork for a settlement that can range from 40 to 80 percent of your total outstanding balance. In other words, most credit card companies will accept anywhere from less than half to about four-fifths of what you owe them in exchange for the certainty that you’ll no longer run up a tab that you can’t afford.
Citibank is known for its hard-nosed negotiating tactics, often proposing an initial settlement amount and then upping it at the last moment. Other intimidation tactics include dubious threats of legal action and requesting repayment of the debt on an unreasonable schedule.
These efforts are heavy on the bark but light on the bite. Don’t be intimidated by legal threats or sketchy settlement offers; Citibank doesn’t want to waste its time and money on a court-brokered settlement any more than you do.
What Citibank would like you to do is accept a settlement that you’ll have difficulty paying so that they’ll be able to squeeze as much out of you as possible. Don’t give them the satisfaction! Tell them exactly how much you can afford to pay and when. If they tell you they can only accept a lump sum payment of 50 percent of your outstanding balance, tell them that you’ll be able to pay 40 percent of your balance in a series of payments spread out over the next six months.
Don’t let Citibank tell you that they won’t accept monthly installment payments. This arrangement, called a “structured settlement” in the United States, is common and offers advantages for both cardholders and creditors. For creditors, a structured settlement provides more leverage: Although they won’t get paid as quickly, they’ll be able to reasonably request that their customers repay a higher proportion of their outstanding balance because of the flexibility of the installment plan.
As one of these customers, a structured settlement leaves you in a far better position than a lump-sum settlement. Instead of feeling trapped by the settlement agreement and forced to scrape together every penny to make the payment deadline, you’ll be able to save up for your monthly payments at a leisurely pace, leaving room for other necessary expenses.
If you negotiate in good faith and adhere to your payment schedule, working out a Citibank credit card settlement should be easy and rewarding. Debt negotiation is more popular than ever these days, with thousands of settlement experts nationwide available to assist folks tired of crushing credit card debt. For professional advice regarding debt settlement negotiations with Citibank and other major credit card issuers, call today or fill out the free online form and get started down the road to financial freedom!