If health problems strike, ask for hardship rate reduction

Avoid a settlement if you can; its credit score impact lingers


Credit Wise
Credit Wise columnist Kevin Weeks
With more than 20 years experience in the nonprofit credit counseling industry, Kevin Weeks joined the Financial Counseling Association of America (, @TrustFCAA) as its president Dec. 1, 2014. Weeks has extensive knowledge of both the credit counseling industry and the FCAA organization, having served in leadership positions for three of its member agencies and on the FCAA board of directors. In addition, Weeks is working with FCAA members to help develop a long-term solution to the student loan crisis through the website Weeks holds a bachelor of science degree in business administration, management information systems from Salem State University.

Ask a question.

'Credit Wise' archive

Question for the expert

Dear Credit Wise,
  All my credit cards are up to date, but I'm experiencing health problems and want to see if one credit card company will help by lowering my balance some. Will they do it? And how will this affect my credit score? -- Karen

Answer for the expert

Dear Karen,
I am so sorry to hear of your health problems. I can understand why you are looking for help because medical issues can often be very expensive.

Unfortunately, I do not know that any of your credit card companies will lower your balance for you at this time. Because you are up to date on all of your cards, I think the credit card companies will not be inclined to offer you what is for all intents and purposes a settlement.

However, you may have luck getting one or more of them to lower your interest rate on the balances you do have.

Also, because you are concerned about how your credit score will be affected, I would not recommend any kind of settlement on your accounts. Settlements are second only to bankruptcy in terms of what they do to a credit score. Your score will be negatively affected for years if you choose to pay less than the balance owed on an account. If you find yourself in a situation where you need to apply for credit in the future, this will be an action that will likely hurt your chances for any kind of a decent rate, if you can even get credit at all.

I would recommend that you call your creditors and explain your situation. Many credit card companies offer hardship programs that may reduce both your interest rate and required monthly payment. These programs usually only last for six months to a year, but they are fairly easy to qualify for, especially in the situation you are currently facing.

This action should not have an effect on your credit score and will maybe give you a little breathing room while you deal with your medical issues. I would suggest you call all of your creditors and see what you can work out with them all.

Be wise with your credit!

See related: Credit card forebearance programs offer reprieve from debt

Meet's reader Q&A experts

Does a personal finance problem have you worried? Monday through Saturday,'s Q&A experts answer questions from readers. Ask a question, or click on any expert to see their previous answers.

Published: February 27, 2016

Join the discussion
We encourage an active and insightful conversation among our users. Please help us keep our community civil and respectful. For your safety, do not disclose confidential or personal information such as bank account numbers or social security numbers. Anything you post may be disclosed, published, transmitted or reused.

If you are commenting using a Facebook account, your profile information may be displayed with your comment depending on your privacy settings. By leaving the 'Post to Facebook' box selected, your comment will be published to your Facebook profile in addition to the space below.

The editorial content on is not sponsored by any bank or credit card issuer. The journalists in the editorial department are separate from the company's business operations. The comments posted below are not provided, reviewed or approved by any company mentioned in our editorial content. Additionally, any companies mentioned in the content do not assume responsibility to ensure that all posts and/or questions are answered.

Follow Us

Updated: 10-22-2016

Weekly newsletter
Get the latest news, advice, articles and tips delivered to your inbox. It's FREE.