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How to Settle Credit Card Debt with Citibank

Sarah Edwards | April 11, 2024

Sarah Edwards
Legal Expert
Sarah Edwards, BS

Sarah Edwards is a professional researcher and writer specializing in legal content. An Emerson College alumna, she holds a Bachelor of Science in Communication from the prestigious Boston institution.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Fact-checked by George Simons, JD/MBA

George Simons
Co-Founder of SoloSuit
George Simons, JD/MBA

George Simons is the co-founder and CEO of SoloSuit. He has helped Americans protect over $1 billion from predatory debt lawsuits. George graduated from BYU Law school in 2020 with a JD/MBA. In his spare time, George likes to cook, because he likes to eat.

Summary: Owing a debt to Citibank can cause serious stress, but you have options. Consider increasing your monthly payments to pay off your Citibank debt faster. If you don’t have the funds to do that, you can also consider a debt consolidation loan to simplify managing your payments. Finally, if you’ve been sued for a debt by Citibank, you can settle the debt by responding to the lawsuit, sending a settlement offer, and signing a settlement agreement.

Is your balance with Citibank keeping you up at night, causing stress about what your financial future holds? Are you unable to keep up with your minimum payments with the lender, or do you want to eliminate them so you can redirect your money toward meeting your basic expenses?

Citibank is one of the oldest banks in the U.S. Founded in 1812, it was one of the original banks of New York. It now operates nationwide and internationally in countries such as Mexico.

Citibank offers numerous financial services, including banking, mortgages, credit cards, and loans. Millions of people have accounts with Citibank, whether they use the company for banking or loans.

Despite its long history as a popular bank, Citibank’s BBB rating is the worst available: an F. Customers complain about the company’s policies of charging unauthorized fees and penalties and approving fraudulent transactions without notifying customers of abnormal activity.

If you’re tired of dealing with Citibank, you’re not alone. There are many alternatives available for eliminating your Citibank debt.

Settle debt with Citibank.

You can negotiate debt settlement at any stage of the collections process. SoloSettle makes it easy.

Settle with SoloSettle

How can I pay off my Citibank debt?

The ideal way to pay off your Citibank debt without hurting your credit score is by increasing your monthly payments. Rather than making the minimum payment, put all of your extra resources toward your Citibank obligation.

The more money you can pay toward your outstanding debt, the faster you’ll be free from Citibank.

Consider a Citibank customer with a $5,000 balance on their credit card. Their monthly minimum payment is 4% of their balance, or $200. Citibank charges them an interest rate of 18.9%, which compounds the outstanding amount.

The customer can expect to pay off their Citibank debt with minimum payments in just over 11 years. In all, they’ll pay over $3,000 in interest.

However, if the customer can add an extra $200 a month, their final payment toward the debt comes in 63 months, just over five years later. They minimize their borrowing cost and pay a more reasonable $1,200 in interest.

If you’re not in a position to increase your Citibank monthly payments, debt consolidation can also help you manage your debt.

Consolidate a Citibank debt

If you have a good credit score and the means to repay a debt consolidation loan, you can consolidate your Citibank debt.

Debt consolidation is helpful for people who want to pay off high-interest credit cards and loans with a one-time payment. The consumer obtains a debt consolidation loan, which they use to repay the balances on all of their existing credit card debt.

Instead of making payments to multiple lenders, the consumer makes a single monthly payment to their debt consolidation creditor. The interest on a debt consolidation loan can vary from 0% to 15%, making it less expensive and more effective than paying multiple lenders.

However, someone who has poor credit will probably not be able to secure a debt consolidation loan.

If this is you, debt settlement may be your next best bet.

Settle your Citibank credit card debt

It is possible to settle your account with Citibank for less. You’ll need to have savings you can pull from to pay off a significant portion of the debt. It’s also best that you stop making your minimum payments for a period—typically three to six months—before attempting to negotiate a settlement.

If Citibank sees that you are not making your payments, you’ll likely start receiving calls from the bank’s representatives in an attempt to get you back on track with your loan. They may offer certain concessions, like lowering your interest rate or minimum payment.

Once the appropriate amount of time passes, you can ask for a settlement. Start your negotiations low so there is room for Citibank to counter your offer. Make your payment when you come to an agreement that works for you.

If you’re able to settle your debt with Citibank, make sure to get written confirmation of your agreement. You should also ask the bank to report your account as paid in full to the credit reporting bureaus.

What should I do if Citibank is suing me for unpaid debt?

When you do not attempt to repay your Citibank debt, the company may try to take you to court. However, reaching a settlement agreement is still possible. In fact, you can reach out to settle the debt at any stage of the lawsuit process. Here’s how.

Follow these three steps to respond to a Citibank lawsuit and settle your debt:

  1. File an Answer to the lawsuit.
  2. Send a settlement offer.
  3. Get the settlement agreement in writing.

Keep reading to learn more about these steps, or check out this video:

First, respond to the lawsuit by filing an Answer into the case and sending a copy to the opposing attorney. Your Answer should address each claim against you and state your reasons why you believe the debt is invalid.

Even if you’re not sure whether you can win in court, an Answer prevents Citibank from obtaining a default judgment against you, which further prevents wages garnishment and liens being placed on your property.

Responding to the lawsuit buys you time to negotiate a debt settlement and avoid losing automatically. You’ll still get your chance to state your case in court, even if you cannot reach a settlement agreement with the company.

Second, figure out the most you can afford to pay Citibank. If Citibank has a strong chance of winning its case against you, you’ll want to offer at least 60% of the obligation you owe. For instance, if your current balance is $2,000, you can offer Citibank $1,200 in a one-time payment to settle the amount due.

Once you know how much you can pay, send an offer. Your offer may sound something like:

“Dear Citibank debt collector, I would like to settle my debt with case number ____. I can offer a lump-sum payment of $1,200 to be paid within 90 days of settlement. Please only respond to this message with an acceptance or counter offer. I’m prepared to fight this matter in court and win. I’m also prepared to file an FDCPA complaint. This offer expires on XX/XX/XXXX.”

Citibank will likely reply to your message but may counter your offer with an amount of their own. If you cannot pay the amount the bank requests, you can attempt to explain your financial situation. Sometimes, creditors will give you some leeway, especially if you have significant hardships.

Third, get your debt settlement in writing once you reach an agreement with Citibank. Their written statement will protect you if the bank tries to collect the remaining debt in the future.

If you’re apprehensive about handling the settlement process yourself, SoloSettle can do it for you.

Use SoloSettle to settle your credit card debt with Citibank

SoloSettle, powered by SoloSuit, empowers you to negotiate and reach a debt settlement on your own.

Use the SoloSettle web-app to send and receive offers from collectors. It will draft offers for you and protect you from the potential lies and bullying of debt collectors. Most importantly, SoloSettle makes sure all of the proper legal language is included to protect your rights when communicating with the creditor or debt collector.

When a settlement agreement is reached, SoloSettle manages the settlement agreement documentation for you and protects your sensitive financial information from the collectors, preventing them from over-charging you.

Here are some of the benefits of using SoloSettle to settle your debts:

  • You can settle debts of any size with SoloSettle. Many debt settlement companies require you to have a debt over $15k.
  • SoloSettle actively attempts to settle your debt, whereas many debt settlement companies take a more passive role, waiting for settlement offers to come to them.
  • SoloSettle is offered by SoloSuit, a trusted brand and a legitimate company. Many traditional debt settlement companies are actual scams.
  • SoloSettle has legal defense built in with SoloSuit. While settling, you can use SoloSuit to block lawsuits if you need. Most debt settlement companies don’t provide legal defense; if you’re sued for a debt you are on your own.

Still not convinced? Check out this review from a real SoloSettle customer:

Settle debt with SoloSettle.

"I'm very thankful for SoloSettle. Having a third party negotiate the settlement was instrumental in resolving this case and saved me from two giant headaches: 1) I didn't have to deal with the plaintiff's lawyer and 2) I didn't have to go to court. I also love that the payment was processed through SoloSettle. I was nervous about sharing my personal financial data with the other side, but SoloSettle protected that for me. I hope I never get sued again, but if I do, I would use SoloSettle again in a heartbeat." - Dan

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You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.

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Negotiate a Citibank debt settlement

Hiring a debt settlement attorney can be expensive. Luckily, you don't need an attorney to be able to settle your debt.

We wanted to learn more about how to negotiate debt settlement with Citibank collections, so we asked a debt lawyer to share some tips and tricks on how to settle with creditors and debt collectors. Here's what we learned:

  • Avoid threatening bankruptcy if you don't mean it, as this empty threat is often ineffective.
  • Paint a picture of your financial hardship to the creditors or their lawyers.
  • Show proof of your limited ability to pay, like being on Social Security, facing multiple debts, or having wage garnishments.
  • Make a realistic offer, considering they will likely counteroffer.
  • For junk debt buyers, settlements of 10-35% of the total debt are typical, while original creditors may accept 50-75%.
  • If you propose a payment plan, ensure it's realistic for your budget.
  • Be truthful about your financial situation, as creditors often have detailed information about you.

Watch this video for the full interview on debt settlement with a debt lawyer, John Skiba:

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