If you are trying to negotiate a debt settlement for your credit card debt, it will depend on who you are dealing with on how to proceed. If the debt is still with the original creditor - the card company itself, you will deal with it differently than if the debt has been passed to a collection agency.

When dealing with the original creditor or Credit Card Company you can either go through a consumer credit counselling service or you can contact the company on your own. As long as you are less than 150 days late on your payments and the company is still managing the debts, you should be able to work with them.

Once you find out if the debt is still with the credit card company, you can do this by calling them and asking; you can begin your negotiations. If at all possible, try to make sure your debt doesn’t go to collections as you will end up with 2 marks against your credit score. American Express will send your account into collections if you haven’t paid to your account after 90 days, the others will wait until 120.

A company will usually not work with you until you are at least 60-90 days down on your debt. They don’t really want to part with half their money if they don’t need to. If you are current with your payments, they are less likely to work with you. So you need to be at least 60 days late. This isn’t to say don’t pay your monthly amount if you are able to; you don’t wish to risk your credit rating unnecessarily.

Due to this economy right now, many companies are willing to take 35%-50% of the total debt as payment in full. If you don’t have the lump sum payment, some creditors will spread out your payments over several months. Don’t look for a payment plan of over 6 months though, one good reason to negotiate for yourself instead of through a credit counselor.

You don’t need to get anything in writing in order to get a deal with them. In fact for the most part they won’t send you anything. To protect yourself, you can record the conversation as long as you live in a state that allows this. If you live in a 2 party state you will need their permission to record the conversation. You can also keep a careful log of all phone conversations you have with them.

You can pay by phone, check and money order and in some cases by credit card. If you pay in full you will either get a ‘paid in full’ rating or a ‘settled’ rating. Most companies will opt for a ‘settled’ rating, which is still better than having a black mark on your credit rating.