What to Say When You Can't Pay

Kathleen Esposito
Sad guy

Choosing the Right Words

Can't pay your credit card bill? Resist the urge to ignore those bills. If you want to preserve your credit, it's best to stay honest and keep in touch with the lender.

You are not the first person who has had this problem, and companies are used to negotiating payments. It's likely the lender will work with you, especially if you keep the lines of communication wide open.

Couple with bills

"I Can't Pay Next Month."

Acknowledge to your creditor that you can't make your upcoming payment. It is far better to approach your creditor with this information before you actually miss your payment than it is to wait until your payment due date has already passed. If you wait, you risk a late fee or being referred to a collection agency.

Call center employees

"I Can Pay on This Date."

Give your creditor a realistic idea of when you may actually be able to make your payment. Some creditors are willing to allow cardholders to skip a payment without penalties as long as there is a promise of a timely payment on the next due date.

Keep in mind that your creditor is more likely to be lenient with a temporary payment setback if you have an otherwise consistent record of timely payments.

Happy woman with credit card

"Can We Reduce My Payments?"

If you can't afford the entire payment due, see if your creditor can offer you a payment plan. For example, see if you can make two $30 payments over the span of the statement cycle instead of one $60 payment.

It helps the creditor to know the money will be coming in, and it helps you catch up with your budgeting.

Percent signs

"Do You Offer Interest Only?"

Sometimes a lender will allow you to credit payments just to the interest. It's a win for you because it keeps your history of on-time payments, and it's a win for the creditor because the interest is how the creditor makes its money. Be sure to ask for a temporary restructuring of payments; not a brand-new, interest-only loan.

Note that credit card companies do not offer an interest-only option because their payments are structured differently from installment loans.

Person with bills

"May I Speak To a Supervisor?"

If you are attempting to work out a delayed payment or other plan with your creditor and the representative is less than helpful, do not accept this as a conclusion. Ask to speak to a supervisor who will have the authority to assist you.

Always get the name of the person you talk to, and ask to get a record of the conversation in writing.

Credit form

"Send Me Proof of What I Owe."

Sometimes, creditors do make mistakes. If asked, they must send you verification of the debt by mail. Look this over and make sure that you are actually responsible for the money owed, that it is not due to a billing error or identity theft. During this process, collection activity must be put on hold.

Sad woman with piggy bank

"How Can I Avoid a Charge-off?"

If your bill is already seriously late, you may still be able to work with your creditor. It's better for the creditor to get some money than to get none at all, such as if you have to declare bankruptcy.

In this case, tell the lender that you want to pay the full amount but you do not have the means. Sometimes, you can negotiate to pay less than you owe and still satisfy the debt.

Frustrated woman on phone

"Do Not Contact Me."

If you know there is no way for you to meet your payments, or any modified version of your payment, you can tell your creditor to stop calling you. Your creditor will not be allowed to contact you except by mail to tell you about action taken on the debt, thanks to the Fair Debt Collection Practices Act.

Just because your creditor doesn't contact you, it does not mean you don't owe the money. Only take this step if you know you can't pay and the contact with the creditor is causing you significant anxiety.

Bankruptcy form

"Speak to My Attorney."

If you have filed for bankruptcy, refer your creditors to your attorney instead of dealing with them yourself. Whatever you say in this situation may be recorded and used against you. Be smart and don't say anything at this point.

Only use bankruptcy as a last resort. Try the rest of the tips first.

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What to Say When You Can't Pay