How to Settle My American Express Credit Card Account

Full Take: American Express Celebrates The Opening Of The Centurion Lounge At Miami International Airport -  Day 2
An ivy covered wall with the American Express logo on it inside a building. (Image: John Parra/Getty Images Entertainment/Getty Images)

If you've fallen behind on your American Express bill or are simply tired of throwing away money each month on interest and fees, debt settlement may be one option for eliminating your debt quickly. Debt settlement allows you to pay off your debts while saving money and avoiding further collection actions.

Step 1

Stop making your monthly payment to American Express if you haven't already done so. American Express will not consider a settlement unless your account is past due, and the longer your account is delinquent, the better settlement you may be able to get.

Step 2

Determine what amount you plan to offer as a settlement. Your offer should be a percentage of the current outstanding balance and reflect how much you can comfortably afford to pay. You may choose to offer as much as 75 percent or as little as 35 percent. How much American Express will accept depends on how much is owed, how delinquent the account is, your credit history and your financial situation. Prepare multiple offers in case your first offer is rejected.

Step 3

Contact American Express to determine whether it is still the creditor or whether your account has been assigned or sold to a debt-collection agency. A charge-off— in which the creditor writes off your account as uncollectible—may occur anywhere from 90 days to six months after the first missed payment, depending on the type of account you have. While it's always better to try to settle the debt with the original creditor, in some instances American Express will sell the debt to a third-party debt collector, which may bar American Express from arranging any account settlements.

Step 4

Draft your settlement proposal letter. Include your name, account number, the total outstanding balance and the amount of your offer. You may also choose to include information related to your current financial situation and an explanation of why your account became delinquent. Acknowledge your responsibility for the debt while also pointing out why you think the company should accept your offer. Request that the company notify you via certified mail if it accepts your offer.

Step 5

Make arrangements to pay if your offer is accepted. American Express may offer to draft your payment or payments directly from your checking account; however, you should consider making payments via check, money order or Western Union instead. This creates a paper trail of your payment history and protects you against unauthorized bank drafts. If your offer is rejected, draft a counteroffer and increase your proposed settlement amount. You may need to contact American Express several times before your settlement offer is accepted.

Things You'll Need

  • Recent American Express account statements

  • List of monthly expenses

  • Recent income statements

  • Computer with printer

Tip

Maintain detailed records of all correspondence with American Express, including payment records. Consider other options, including debt consolidation or debt management, if you're unsure whether debt settlement is the right choice.

Warning

Debt settlement will hurt your credit score for up to seven years. Make all arranged payments on time and in full to avoid defaulting on the settlement agreement.

REFERENCES & RESOURCES
Comments
PARTNER & LICENSEE OF THE LIVESTRONG FOUNDATION

Copyright © 2018 Leaf Group Ltd. Use of this web site constitutes acceptance of the LIVESTRONG.COM Terms of Use, Privacy Policy and Copyright Policy. The material appearing on LIVESTRONG.COM is for educational use only. It should not be used as a substitute for professional medical advice, diagnosis or treatment. LIVESTRONG is a registered trademark of the LIVESTRONG Foundation. The LIVESTRONG Foundation and LIVESTRONG.COM do not endorse any of the products or services that are advertised on the web site. Moreover, we do not select every advertiser or advertisement that appears on the web site-many of the advertisements are served by third party advertising companies.