By Sean A. Kelly

‘What can I do if I receive a debt settlement offer from Amex?’ is a question that some heavily indebted Americans may be asking themselves at this very moment. The easy answer is of course, to accept it, but wait! Things are hardly ever as simple, especially when it comes to financial matters.

American Express, commonly known as Amex, is a global financial service company and has been listed as one of the top 30 Most Admired Companies in the World by Fortune. Given this high power background, you may find yourself asking if a debt settlement offer from Amex is valid. If your account has been delinquent and debt payments have been long overdue, then yes, Amex may just do that. In fact, most lenders or creditors would be quite willing to settle your debts if you are in a deep financial distress where your next best option is to announce bankruptcy. When you do that, none of your lenders or creditors will be able to collect a single penny from you, which is why it is usually in their best interest to settle with you.

Debt settlement is also sometimes known as debt negotiation. In a scenario when you are no longer able to make the monthly minimum payment, even with lowered interest rates and waivered late fees, you may opt to negotiate with your creditors to settle the debts. The settled amount is usually lower than the total amount owed, but is acceptable to both the creditor and yourself. Bear in mind that Amex, or any other creditor for that matter, will generally not consider debt settlement if you are current on your payments. In most cases, the longer your account has been past due, the better settlement you are likely to receive.

As mentioned earlier, debt settlement is not a simple matter. Be sure to call Amex first to ensure that they are still your assigned creditor, as they typically charge off delinquent accounts after 6 months although it could be as early as 90 days too. After the charge off, you would not be dealing with Amex anymore, but more likely a third party debt collection agency. Even if Amex has extended a settlement offer to you, there is a chance that you may still negotiate further. Settlement offer can usually range from as low as 20% to 85%, depending on the creditor, your credit rating and the account’s delinquency. Your initial offer may be rejected but don’t give in; instead continue to propose until both parties can reach to an agreeable offer. You may want to be prepared for such negotiation to last for a few days, perhaps even weeks.

Don’t worry if the majority of your debt is made up of credit card debts – you may still settle these debts. However, you should know that credit card settlement ordinarily only involves the debts incurred from credit cards. If you have other debts that you wish to settle, you would probably need to do it in another settlement. Again, take your time to discuss about the settlement offer with your creditor until you reach an agreement. Another question that is often asked is whether one should do this on one’s own or to hire a professional. This really depends on the individual. The upside of getting professional help is that they are more likely to know how much a creditor is willing to settle for and how to go about doing it. Some negotiators will assist you for a small fee, but there are non-profit agencies that provide such service free of charge too.

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