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American Express Debt Consolidation

American Express is My Largest Creditor. What Debt Consolidation Options are Available to Help Me with AmEx and My Other Creditors?

I've had American Express accounts for many years. Never had a problem with them but my wife lost her job this year and we are soon not going to be able to make all of our payments. Right now, our credit score is good, even though we have about $35,000 in total credit card debt. What options can you suggest to us for consolidating our AmEx and other credit card debt?

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Bill's Answer
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American Express Debt Consolidation | American Express card

Thank you for your question about your overall debt and your specific concerns about your American Express debt consolidation options. American Express is a major credit issuer, with over 100 million AmEx cards issued. American Express issues cards for personal and business use. In addition to issuing credit cards themselves, other banks issue cards with the AmEx brand. The same way that there can be a Bank of America Visa or Master Card, there is a Bank of America American Express card.

You can take different steps to work on your debt problems. Some steps are ones you should take on your own. At times, problems may be so severe that they require professional assistance to get the best results.


Contact Your Creditors

Contact your creditor in advance, before you miss any payments. This does not guarantee that they will waive a late fee, not hike your interest rate, or be flexible with you, but maintaining open communication is a smart choice. Find out if they offer a financial hardship program. That may give you some temporary relief. Ask for an interest rate reduction or permission to make a smaller than normal minimum payment.

To see if a professional debt relief firm can save you money and is the right solution for your situation, contact one of's pre-screened debt providers for a free, no-hassle debt relief quote.

Balance Transfers

If your credit is in good standing a balance transfer is another possible debt consolidation solution. Balance transfer rates can be as low as 0%, but they low interest period is only temporary. Make sure you understand the fees that come with the balance transfer and how long the low introductory rate lasts.

American Express Debt Consolidation Loan Options

American Express does not offer unsecured personal loans. If you have strong credit, you may be able to find a debt consolidation loan from another provider, such as a bank, credit union, or a peer-to-peer lender.

Shop around for a personal loan by checking with a unsecured loan partner. Rates can be high, if you don't have good credit. Also, make sure you can afford the monthly payment.

Outside Help

If American Express or your other creditors are not willing to work with you, your best debt relief solution may be to work with a professional debt relief organization. Look into both credit counseling and debt settlement. Before you choose the right way to solve your debt problem, it can be very important to understand how your specific creditors work with their customers. That way, you can plan the most effective strategy for getting out of debt.'s editorial staff has done extensive research to provide you with some specific facts about American Express and how it deals with accounts enrolled in debt relief programs.

American Express Credit Cards & Credit Counseling

If you enroll a American Express account in a credit counseling's debt management program, you should expect:

  • A monthly payment that is 2.1% of your balance for payment
  • A minimum monthly payment of $15
  • An interest rate of 9.99%. If your current rate is below 9.99%, not only is there is no reduction, but your rate will be increased to the 9.99% in the DMP. If you have a card with an interest rate below the one the DMP will put in place, you can try keeping the card out of the program, but most DMPs require you to place all of your cards into their program.
  • For the American Express Bank of America Accelerated Rewards Card, expect to pay 2.25% of your balance for  your DMP payment and 12% interest.

American Express & Debt Settlement

Consider debt settlement to resolve your debt, if you are in a serious financial hardship. Debt settlement is an aggressive form of debt relief that's designed to get you out of debt in 24-48 months. For a debt settlement program to succeed, you need to make a monthly program payment, which is usually significantly smaller than your required minimum monthly payments. reviewed hundreds of settlements reached by professional debt settlement negotiators for the client's American Express accounts. The average settlement negotiated was less than 52% of the balance that the clients enrolled in the settlement program for all accounts still in the hands of AmEx. Account sent to legal collections settled at a higher percentage.

You are free to negotiate directly with your creditors, if you feel you can do so successfully. However if you are not confident that you have the skills, nerve, and time to handle back and forth negotiations with debt collectors, consider hiring a reputable and experienced settlement company. Make sure that you only work with a debt settlement firm that  charges no up-front fees. recommends choosing a debt settlement firm that is a member of the AFCC (American Fair Credit Council) and has debt consultants that are accredited by the IAPDA (International Association of Professional Debt Arbitrators).

Collections Process

If you default on any of your American Express accounts, or with any of your other creditors, and you are unable to work out a solution with them, you will end up in collections. Not every creditor treats all their delinquent accounts. Even the same creditor may treat individual customers differently. However, there are some basic strategies and practices that American Express and other creditors use when collecting on delinquent accounts.

General Collections Practices

  • Most creditors first attempt to collect a debt internally. If not successful, they refer the account to an outside collection agency or a law office for collections.
  • Some creditors have in-house legal departments to collect on the debt, though that is becoming less common.
  • In general, accounts are referred for legal collections after they are somewhere between six and nine months delinquent, depending on the creditor.
  • Your recent activity on your account can affect the collection process. Some creditors pay close attention to your specific account activity, when deciding whether to pursue legal collections. For instance, large recent purchases may cause a creditor to pursue collections more aggressively.
  • Eventually, your account may be sold to a debt collector. Creditors that are unable to collect anything after your debt has been contracted to a law office usually sell the debt to a debt purchasing collection agency. This frequently happens approximately 18 to 24 months into the collection process.
Different factors influence how aggressive a creditor is when collecting on your debt, including: the state you live in, the assets you own, and state-specific collection laws. Creditors are less likely to engage in legal collections, for example, in states that don't allow for wage garnishment, such as Texas, Pennsylvania, and South Carolina.

American Express's Collection Process and Legal Action

Here are some facts about how American Express handle collections accounts, based on research:

  1. American Express is a very aggressive creditor, when it comes to collecting on delinquent accounts.
  2. They begin to offer settlements when the account is in pre charge off status. Usually about 3 to 4 months after the last payment was made.
  3. Accounts in the Recovery Department, the last stop before an account gets sent to legal collections, may be willing to settle in full for 50%, after the account charges-off.
  4. Most settlements need to be paid off in full within a 90-day cycle, though settlements on very large balances may be given more time.
  5. An account goes to legal collections based on the customer's credit report and assets. Large balances are likelier to end up in legal collections.
  6. They pay close attention to recent charges made prior to any default. If you made large purchases in the six months before you defaulted, it is far likelier that your account will be sent to legal collections.
Bills Action Plan
  • Keep in touch with your creditors. Let them know if you're going to miss a payment.
  • Open every letter you get from a creditor. Ignoring a problem will not make it go away.
  • Review each one of your debt relief options, before you decide which one is best for you.
  • Check out the's no-cost Debt Coach tool. Debt Coach allows you to easily go over all your available debt options, based on the goals and priorities that you specify, giving you a realistic estimate of how long it takes to get out of debt and what your total costs will be.
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