What to do if you're falling behind on credit card debt

Not being able to pay your credit card bill is a daunting situation to deal with. And it's one that is happening to "more Americans," said NPR, as "about 8.9% of credit card balances fell into delinquency over the last year, according to the Federal Reserve Bank of New York — a sign that a growing number of borrowers are feeling the strain of rising prices and high interest rates."

When you miss one minimum payment on your credit card, the situation can quickly move from bad to worse. You will likely get hit with a late fee, and interest will start racking up on your existing balance, potentially at a higher rate known as a penalty APR if payment is late enough.

The good news is, if you find yourself in this position, there are steps you can take to bring your financial situation back under control.

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Get in touch with your credit card issuer

The "very first thing you should do when you become delinquent on a credit card payment is contact your issuer," said NerdWallet. This also applies "if you realize you're going to miss a payment or two," said U.S. News & World Report.

Your issuer may be able to help you out in some way. For instance, "if you have a history of making payments on time and expect your personal situation to improve soon, it might be enough to call up and ask for a one-time late fee waiver," said Forbes. Or, "if you expect ongoing challenges, you might need to ask about joining a potential hardship program instead." Another option is "requesting to change your due date on future billing cycles."

When you pick up the phone, be ready to explain "the reasons for falling behind on your payments," "when you'll be able to make a payment," and "if you're able to pay anything right now," said NerdWallet.


See if you can adjust your budget (or your income)

Next up, it is important to figure out how you can begin paying off your balance, as "the sooner you can start making payments, the sooner you'll get out of delinquency and back on track," said Bankrate.

Comb through your budget to see if there is anywhere you can cut back, at least for now. You could also figure out a way to bring in extra money. For instance, said Forbes, you can "pick up extra hours at work," or look into "selling items you don't use or doing odd jobs for a neighbor."

While you are working to pay off your balance, make sure you're not simultaneously growing it by continuing to use your card for purchases. Otherwise, paying down your debt is going to be that much harder.

Explore debt consolidation options

If your credit score is still decent, another option to expedite debt paydown is debt consolidation. Two options for this are a balance transfer credit card and a debt consolidation loan.

With a balance transfer credit card, you may be able to get a 0% APR for a certain period of time, which "allows you to transfer card balances and pay down your debt interest-free during that time," said U.S. News & World Report. However, "the risk is that you won't be able to pay off the balance, and you'll owe interest at a new rate on the remaining charges."

A debt consolidation loan, on the other hand, "combines all of your bills for a single payment to make managing your finances easier and spreads out payments for better affordability," said U.S. News & World Report. You will be paying interest, though usually at a lower rate than you would with a credit card.

Consider working with a credit counselor

You do not have to figure your way out of this situation alone. Instead, you can work with a nonprofit credit counselor, who "may be able to help you create a debt management plan with your card issuer that includes a lower monthly payment, and perhaps a lower interest rate," said Bankrate.

Just keep in mind you may need to "close your credit card account if you go this route," said Bankrate, and you may pay a fee. Still, it can help you figure out a manageable path forward.