First – understand that any step along the process where you do not have to pay back the full amount owed, your credit score will be dinged. Don’t expect to keep your credit report clean and negotiate with a creditor for a settlement. If you are dealing with the creditor themselves you can expect the person on the other end of the phone to be fairly reasonable and focused on finding a way for them to get ALL of their money back.

If you have been moved over to a debt collection company you are in a completely different situation. Debt collection companies are the thugs of the financial world. While your credit card company will almost always be pleasant on the phone debt collection companies live off threats. They know that the average consumer is relatively uniformed when it comes to the credit process and they use this to their advantage.

Make sure to read-up on the credit process and the real power that credit card companies and collection agencies have. You have many legal rights that can and should be exercised in times of financial hardship.