Do Hardship Letters to Credit Card Companies Work?

Written by wanda thibodeaux
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Do Hardship Letters to Credit Card Companies Work?
Credit card hardship letters are only appropriate if you cannot pay your balance through no fault of your own. (credit card image by jimcox40 from

Many find it hard to pay off the credit debt they acquire. In some cases, a hardship letter to a credit card company is appropriate when you cannot pay your credit card balance. Before you write such a letter, you should familiarise yourself with how they work. This will make it more likely that you'll draft your letter in a way that appeals to the company representative.

Letter Contents

A hardship letter basically explains to the credit card company why you cannot pay your balance and makes a plea for a settlement or lower interest rate. The first part of the letter typically is this formal appeal. The middle of the letter indicates what documents you are enclosing as evidence of your hardship. This section is imperative, because credit card companies may deny your appeal if you can't verify your hardship is authentic. The end of the letter indicates whether you're also negotiating with other creditors (you don't want to show preference to one creditor over another) if you have multiple debts. It also politely closes the letter and invites the company to contact you.

Assessment of the Letter and Appeal

When your credit card company receives your hardship letter, a company representative reviews the contents, including your supporting documentation. They assess your appeal based on how well your request adheres to corporate policies, as well as on the professionalism and completeness of your proof of hardship. If the company representative determines that your appeal is drawn under reasonable circumstances, he works to approve your request and modify your interest or balance due. An example of a "reasonable" circumstance might be a job layoff or getting hurt at work. If the representative finds that you are not truly in hardship, or if you ask for a settlement amount or interest reduction the company cannot possibly manage under its policies, he will deny your request and your account remains unchanged. An example of an unreasonable appeal would be where you can't pay your balance simply because you squandered available funds on items like CDs or leisure travel. Usually, the representative notifies you of his decision in writing. If he calls, you should request that the judgment be written and sent to you. Do not take any further action until you have something on paper.


Hardship letters are not always a permanent solution to your credit card issues. Often, they provide only temporary relief. For example, a credit card company may agree to lower your interest rate but only for a specified number of months until the hardship you defined in the letter passes, or on the condition you enrol in credit counselling the company offers for free. You should not see hardship letters as a safety net for this reason, particularly since there is no guarantee that the company will accept your request. Hardship letters also do nothing to modify your existing spending habits.

When to Send the Letter

Ideally, you should send a hardship letter to your credit card company as soon as you realise you cannot possibly pay what you owe. If you contact the company early, the odds of getting interest rates lowered are better. If you wait until the company has sent your balance to collections, you'll have to try to settle. This is much harder to do because it asks the credit card company to write off some of your debt -- with an interest reduction request, the company still is entitled to your whole balance.

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