Misconceptions About Credit Card Debt Settlement

Information verified correct on September 27th, 2016
credit card debt

When we end up with credit card debt, there might not seem to be a way out.

Debt settlement of our credit card may appear to be the only way out of debt. It is important to remember that these credit card companies know what they’re doing and there are some debt settlement credit card tips that you should be aware of before you turn to a debt settlement company.

Debt Settlement Is Favoured

When you are thinking about settling your debt, a credit card tip to remember that settlement is not the only option – you do have other choices with handling your credit card debt.

Some good options for reducing credit card debt are creating a better budget, liquidating some assets, or getting a small loan. The only problem with these options is that they take time. And that can seem scary when debt is all you can think about.

But in the long run, choosing one of these options over settlement will save you a lot of money. It will also help your credit score more than a settlement will. If you choose one of these options, concentrate on the savings that you will make in the end – not the amount of time it is taking you to get there.

Debt Settlement Is A Right

As a credit card holder, you do not have a right toward asking for a settlement. Often, a lot of concessions are made, for example, penalties are waived, fees are lowered, credit limits increased. Customers sometimes get the impression that they have the right to receive this kind of goodwill and will request a settlement.

Another tip to remember involves asking for a settlement is not restricted – but neither is a card company’s ability to turn down the request.

Debt Settlement Companies Are Pro-Consumer

Although settlement companies are sought to help their customers reach settlements for their credit card debt. This is true, but it does not mean that they are working in their clients’ best interests. These guys need to make money too!

Settlement companies can and often do charge their customers a huge number of fees to help them clear their credit card debt.

It is not unheard of for settlement companies to set up terms with a customer, including a payment schedule, fees, and interest. This essentially turns them into an even worse lender than the card companies!

Settlement of your debts is not your only option. It is very important to remember this, because settling your debts on your own or using other means instead of settlement can be a lot more beneficial to you and to your credit score.

Balance Transfer Credit Cards Comparison

Rates last updated September 27th, 2016.

American Express Explorer Credit Card

10,000 Membership Rewards Bonus Points + 0% on balance transfers for 12 mos. Offer ends 30 Nov 2016

August 26th, 2016

HSBC Platinum Credit Card

$0 annual fee + 0% for 15 months on balance transfers offer extended until 31 December 2016

September 1st, 2016

Virgin No Annual Fee Credit Card

Balance transfer offer has been extended to 31 October 2016.

September 26th, 2016

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Balance transfer rate (p.a.) Purchase rate (p.a.) Annual fee Interest Saved
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Offers 0% p.a. interest rate on balance transfers for 18 months to help you manage your existing credit card balance with a reduced annual fee in the first year.
0% p.a. for 18 months 20.74% p.a. $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
St.George Vertigo Visa
Introductory offer of 0% p.a. for 18 months on balance transfers and 1% p.a. for 12 months on purchases, plus a low annual fee.
0% p.a. for 18 months 1% p.a. for 12 months (reverts to 13.24% p.a.) $55 p.a. Go to site More info
Westpac 55 Day credit card
Enjoy a balance transfer offer of 0% p.a. for 16 months, an introductory purchase rate of 1% p.a. for up to 12 months, plus a waived annual fee for the first year if applied by 11 October 2016.
0% p.a. for 16 months 1% p.a. for 12 months (reverts to 19.84% p.a.) $0 p.a. annual fee for the first year ($30 p.a. thereafter) Go to site More info
HSBC Platinum Credit Card
Receive a full annual fee refund and save $149 if you meet the $6,000 spend requirement. Enjoy a balance transfer offer and platinum card benefits such as complimentary insurances and concierge services.
0% p.a. for 15 months 19.99% p.a. $149 p.a. Go to site More info
Westpac Low Rate Card
A no frills credit card with an introductory rate of 0% p.a. for 18 months on balance transfers and 1% p.a. for 12 months on purchases.
0% p.a. for 18 months 1% p.a. for 12 months (reverts to 13.49% p.a.) $59 p.a. Go to site More info
St.George Vertigo Platinum
A platinum card with a balance transfer offer of 0% p.a. for 20 months and an introductory purchase offer of 1% p.a. for 12 months with an annual fee waiver for the first year.
0% p.a. for 20 months 1% p.a. for 12 months (reverts to 12.74% p.a.) $99 p.a. Go to site More info
NAB Low Rate Credit Card
The NAB Low Rate Card offers 0% p.a. on purchases and balance transfers for 15 months. This card also comes with a low annual fee.
0% p.a. for 15 months with a one off 2% balance transfer fee 0% p.a. for 15 months (reverts to 13.99% p.a.) $59 p.a. Go to site More info
ANZ First Visa Credit Card - Exclusive Offer
Take advantage of this exclusive offer and enjoy 0% p.a. for the first 12 months on balance transfers and 0% p.a. for the first 3 months on purchases.
0% p.a. for 12 months 0% p.a. for 3 months (reverts to 19.74% p.a.) $30 p.a. Go to site More info
Virgin No Annual Fee Credit Card
Enjoy a long term balance transfer plus a $100 cashback offer (spend criteria applies) and never pay an annual fee for this card.
0% p.a. for 18 months with 2% balance transfer fee 18.99% p.a. $0 p.a. Go to site More info
NAB Low Fee Card
Enjoy a low introductory rate of 0% p.a. on balance transfers and purchases for 15 months.
0% p.a. for 15 months with a one off 2% balance transfer fee 0% p.a. for 15 months (reverts to 19.74% p.a.) $30 p.a. Go to site More info
Bank of Melbourne Vertigo Visa Credit Card
Enjoy a low annual fee combined with 0% p.a. balance transfer offer for 18 months and 1% p.a. for 12 months on purchases.
0% p.a. for 18 months 1% p.a. for 12 months (reverts to 13.24% p.a.) $55 p.a. Go to site More info
American Express Essential Credit Card
Receive a $50 credit on eligible spend and get Smartphone screen insurance combined with a no annual fee for life card. Also enjoy a 0% p.a. balance transfer rate for 12 months.
0% p.a. for 12 months with 1% balance transfer fee 14.99% p.a. $0 p.a. Go to site More info
Citi Rewards Credit Card - Platinum Card
A long term balance transfer offer with the Citi Rewards Platinum Card. Earn extra points on overseas spend and includes travel insurance.
0% p.a. for 24 months with 1.5% balance transfer fee 20.99% p.a. $199 p.a. annual fee for the first year ($249 p.a. thereafter) Go to site More info
American Express Explorer Credit Card
Receive 100,000 Membership Rewards Bonus Points on eligible spend within the first 2 months of Card Membership. Also enjoy a $400 travel voucher and two complimentary airline passes per year.
0% p.a. for 12 months with 1% balance transfer fee 20.74% p.a. $395 p.a. Go to site More info
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2 Responses to Misconceptions About Credit Card Debt Settlement

  1. Default Gravatar
    Helen | March 26, 2013

    My husband and I have huge credit card debt, which we cannot service due to poor health and decreased ability to work. He will get some superannuating next month, We would like to discuss a credit card settlement with the credit card companies. What is a reasonable amount to offer? We can probably pay about 55% of total debt.

    • Staff
      Jacob | March 26, 2013

      Hi Helen. You will have to discuss this directly with the lender to come to a solution. There are so many possible options that I am unable to comment. Sorry I couldn’t be of more help. Jacob.

Credit Cards Comparison

Rates last updated September 27th, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ME Bank frank Credit Card
Enjoy a low and consistent interest rate on purchases and cash advances, combined with no annual fee.
11.99% p.a. $0 p.a. Go to site More info
St.George Vertigo Visa
Introductory offer of 0% p.a. for 18 months on balance transfers and 1% p.a. for 12 months on purchases, plus a low annual fee.
1% p.a. for 12 months (reverts to 13.24% p.a.) 0% p.a. for 18 months $55 p.a. Go to site More info
HSBC Platinum Credit Card
Receive a full annual fee refund and save $149 if you meet the $6,000 spend requirement. Enjoy a balance transfer offer and platinum card benefits such as complimentary insurances and concierge services.
19.99% p.a. 0% p.a. for 15 months $149 p.a. Go to site More info

* The credit card offers compared on this page are chosen from a range of credit cards CreditCardFinder.com.au has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

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