How to Negotiate Credit Card Debts With Bank of America


Credit cards can serve as a very convenient payment option. You can use a credit card to pay for small items, such as lunch or a movie, or much larger purchases, such as an airline ticket or laptop computer. The downside of credit usage is the possibility of debt accumulation. If you have credit card debt with Bank of America, the good news is that according to the Federal Trade Commission, it's not necessary to pay someone to settle the debt for you. You can do it yourself by speaking with Bank of America directly.

Things You'll Need

  • Credit card statements
  • Settlement agreement

Gather your credit card statements from Bank of America. Examine the bills to ascertain the exact amount owed, including outstanding principal, accrued interest, late fees and any other miscellaneous charges.

Calculate the total amount that you can afford to pay towards the debt. This dollar figure will serve as your settlement offer to the bank.

Call Bank of America and ask to speak with a person in management, such as a manager or supervisor. Customer service reps often do not have the authority to negotiate debt settlements. Inform the manager that you would like to settle the debt, not just make a payment. You can find the number on the bank's website or on the back of your credit card.

Offer an amount that is lower than the total amount you can afford to pay. If you can pay $800 of a $1,000 debt, offer $400. If accepted, you just saved $400 and if the manger counteroffers, you've left yourself room to negotiate.

Request written confirmation of the agreed-upon amount. This agreement should state the accepted payment amount and specifies that your payment settles the debt. If you don't get it in writing, Bank of America could apply the payment toward the outstanding amount due and come after you for the balance.

Make payment to Bank of America once you've received the written agreement. The bank will inform you of your payment options. Whichever option you choose, make sure you keep a copy of the payment receipt for your records.

Tips & Warnings

  • According to the Federal Trade Commission, creditors are not required to settle credit-card debt. They do so at their discretion and as such, you may be required to pay the full amount.
  • If you can't afford to settle the balance with a lump sum, Bank of America may allow you to make payment arrangements on the account. You may be required to make a substantial payment initially then pay off the balance in monthly installments. Ask a manager to explain your options.
  • Think twice before using a debt settlement company. This could cost you money and damage your credit report, according to the Federal Trade Commission.
  • Debt settlement may have tax consequences. If the amount that Bank of America writes off is $600 or greater, the company will report that as a loss to the IRS. You will have to pay taxes on that amount since the IRS will consider it as income to you.

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