Bank of America Credit Card Debt: Settling and Collections

For a cardholder struggling with Bank of America credit card debt, the bank's credit card assistance page gives one reason to call, and to call early: "If you are in financial difficulty, it is in all our interests to get it resolved." That's sound advice. What the page leaves out is what follows if the call doesn't fix things: fees and a penalty rate, a charge-off at 180 days, then collection by the bank, by a buyer it sells the account to, or through a court.

Bank of America credit card debt is a balance owed on a card issued by Bank of America, N.A., the issuer named in its current card agreements, or, on an older account, by FIA Card Services, its former card bank.

Will Bank of America settle credit card debt for less than you owe?

Bank of America can settle a credit card debt for less than the full balance, but its card agreements, credit card help pages and 2025 Form 10-K give no settlement rate, and nothing obliges it to say yes. Its 2025 Form 10-K says that "in certain circumstances, the Corporation will forgive a portion of the outstanding balance if the borrower makes payments up to a set amount," and reports $101 million of principal forgiven that year through modifications of credit card and other consumer loans. That's a portfolio total, not a rate to expect.

Two things decide your answer. Only the account's current owner can agree to take less. And the deal has to be on paper: the bank's card agreements say no payment marked "paid in full" settles the account "without the prior written approval of one of our senior officers." How debt settlement works covers the process end to end.

What happens when a Bank of America credit card goes unpaid?

A missed payment puts a Bank of America card in default under its agreement, brings a late fee of up to $41 and, on most cards, can trigger a penalty rate of up to 29.99%. If nothing is paid, the bank charges the card off no later than the end of the month it becomes 180 days past due.

The default, fee and penalty-rate terms come from the 21 English-language card agreements the bank filed with the Consumer Financial Protection Bureau for the second quarter of 2026. No late fee is charged if your balance is $100 or less on the due date. The penalty APR appears in 16 of them and applies to new transactions after at least 45 days' notice, then "indefinitely"; the BankAmericard, secured or not, and three RateSmart cards have none. In default, the bank can "require immediate payment of your total outstanding balance," add collection costs and an outside lawyer's reasonable fees where the law allows, and close the account; the agreements also say it reports account information to the credit bureaus. What happens when you stop paying a credit card shows when each mark lands.

1. Due date missed

   Late fee and default

   Up to $41; none if the balance is $100 or less on the due date.

2. 45+ days later

   Penalty APR possible

   Up to 29.99% on new transactions on most cards, after at least 45 days' notice.

3. While in default

   Whole balance due

   The bank can demand the full balance and close the account.

4. Day 180

   Charge-off

   By the end of the month the account is 180 days past due.

5. After charge-off

   Collection continues

   Still owed. The bank can keep collecting, sue or sell the account.

Bank of America card agreements (CFPB, second quarter of 2026); 2025 Form 10-K; FFIEC policy.

Bank of America's 2025 Form 10-K sets the rule: card loans are charged off "no later than the end of the month in which the account becomes 180 days past due," or within 60 days after notice of a death or bankruptcy, and they "continue to accrue interest until they are charged off." Federal bank regulators' policy says open-end retail loans 180 days past due "should be classified Loss and charged off" (Federal Financial Institutions Examination Council, June 2000).

A charge-off is a write-off, not forgiveness. In 2025 Bank of America charged off $4.50 billion of card balances and recovered $781 million on balances written off earlier. Other issuers' timelines are in the guides to Chase credit card debt, Citi credit card debt and American Express debt.

Measure	2025	2024
Card loans outstanding at year-end	$106.0 billion	$103.6 billion
Recovered on balances charged off earlier	$781 million	$620 million
Net charge-offs as a share of average card loans	3.68%	3.75%
Principal forgiven in card and other consumer loan modifications	$101 million	$113 million

• MeasureCard loans outstanding at year-end

  2025

  $106.0 billion

  2024

  $103.6 billion

• MeasureRecovered on balances charged off earlier

  2025

  $781 million

  2024

  $620 million

• MeasureNet charge-offs as a share of average card loans

  2025

  3.68%

  2024

  3.75%

• MeasurePrincipal forgiven in card and other consumer loan modifications

  2025

  $101 million

  2024

  $113 million

Bank of America Corporation, 2025 Form 10-K: Tables 20, 21 and 41 and Note 5.

Does Bank of America have a hardship program for credit cards?

Bank of America's credit card assistance pages name no hardship program, but its 2025 Form 10-K says it modifies card accounts for borrowers in financial difficulty, mostly by moving the balance onto a fixed payment plan at a much lower rate. Its credit card assistance page says to log in to Online Banking or call Customer Service at 855.891.3401, adding that "the earlier you contact us the sooner we can work together to come up with a solution."

The 10-K says card modifications usually mean "placing the customer on a fixed payment plan with a significantly reduced fixed interest rate, with terms ranging from 6 months to 72 months, most of which had a 60-month term." The bank arranges them directly and "through third-party renegotiation agencies that provide solutions to customers' entire unsecured debt structures." The bank's Form 10-Q for the third quarter of 2026 puts the weighted-average rate cut on these modifications at about 18 percentage points in the first nine months of both 2025 and 2026, a portfolio average, not the terms any one cardholder will get.

A plan usually repays the whole balance at a lower rate; a settlement pays less than the balance. Creditor hardship programs covers how to ask, and negotiating with creditors before and after you fall behind covers what to say.

Can Bank of America take money from your checking account for a credit card debt?

Bank of America can't take money from your Bank of America checking or savings account to pay a past-due consumer credit card on its own. Regulation Z bars card issuers from offsetting card debt against deposits they hold, and the bank's deposit agreement excludes consumer credit card obligations from its right of set-off.

The bank's Deposit Agreement and Disclosures, effective May 15, 2026, says its Right of Set Off "does not apply to IRA or tax-qualified retirement accounts, to consumer credit card obligations or where otherwise prohibited by law." Other debts you owe the bank aren't exempt.

Three things are different under 12 CFR 1026.12: autopay you set up in writing; a secured card, whose agreement gives the bank a security interest in the deposit account opened with it; and a levy after a court judgment, which comes through a lawsuit, not a setoff. Whether a debt collector can take money from your bank account explains levies and protected funds, and a levy notice belongs with a lawyer or legal aid office.

Does Bank of America sell charged-off credit card debt?

Bank of America can sell a charged-off card account, and its former card bank has. Its current card agreements say the bank "may at any time, and without notice to you, sell, assign or transfer your account," and a federal appeals court has described that card bank selling a charged-off account to a debt buyer. Its 2025 Form 10-K doesn't say whether it still sells card debt.

In Madden v. Midland Funding, decided by the Second Circuit on May 22, 2015, a Bank of America card opened in 2005 moved to FIA Card Services the next year. FIA charged it off in 2008, with about $5,000 owed, and sold the debt to Midland Funding, LLC. That's one account, almost two decades ago, and it doesn't show what the bank does now.

The bank also keeps collecting after charge-off, and its agreements mention "collection agents" and calls from "companies working on our behalf." Once a buyer owns the account, though, it "shall be entitled to all of our rights," and only the buyer can agree to settle. Ask any unfamiliar company in writing whether it owns the account or collects for the bank. Original creditors, agencies and debt buyers explains how each negotiates, and the guides to Capital One debt and Discover credit card debt cover those issuers.

Can Bank of America sue you for credit card debt?

Yes. Bank of America, N.A. sues cardholders in its own name, and its agreements let it seek collection costs and reasonable attorneys' fees where the law allows. Neither its 10-K nor its card agreements say how often it sues or above what balance.

In Bank of America, N.A. v. Dickerson, the bank, through a private law firm, sued in Warren County, Ohio, for $26,877.83 on a card account opened through an electronic application in 2019. The cardholder said her former husband had opened it and that their divorce decree made him responsible. A magistrate ruled for the bank after an August 2024 trial, the trial court adopted that decision, and Ohio's Twelfth District Court of Appeals affirmed on March 31, 2025, explaining that the divorce allocation "has no bearing on appellant's liability to the Bank."

If you're served, the court's deadline comes before any negotiation, though settling may still be possible. Felix doesn't handle lawsuits. Call a consumer attorney or legal aid office, ask whether your agreement's arbitration clause matters, and read what to do first when you're sued over a debt.

Does the Bank of America credit card agreement require arbitration?

Yes. Every English-language card agreement Bank of America filed with the CFPB for the second quarter of 2026 has a binding arbitration provision: either side can move a dispute, including a lawsuit the other filed, into individual arbitration before the American Arbitration Association, and class actions and jury trials are waived. Small claims court is excepted, and borrowers covered by the Military Lending Act may not be bound.

The provision covers "any collection or credit reporting of your account" and survives "any sale or assignment of your account." One all-caps sentence refers to cardholders who opted out of the provision in time, but the filed agreements don't say how anyone could opt out. The bank also reserves the right "to amend this Agreement at any time," so your own account's terms are what count.

The clause

“This Arbitration provision requires that all disputes between you and us be resolved by binding arbitration whenever either party chooses to submit a dispute to arbitration or either party refers a lawsuit filed by the other to arbitration.”

Plain English

Either side can take a dispute out of court, even a collection lawsuit the other side filed.

Ask a lawyer before you invoke it

The clause

“This means that no payment, including those marked with paid in full or with any other restrictive words, shall operate as an accord and satisfaction without the prior written approval of one of our senior officers.”

Plain English

Writing paid in full on a smaller check doesn't settle the account. The settlement has to be approved in writing first.

Get the deal in writing before you pay

Bank of America Customized Cash Rewards card agreement, pricing as of June 30, 2026, filed with the CFPB.

What does FIA Card Services mean on a credit report or collection letter?

FIA Card Services, N.A. was Bank of America's credit card bank, so the name on a credit report or collection letter points to a Bank of America card account from before October 1, 2014, when FDIC records show FIA merged into Bank of America, National Association.

The FDIC's BankFind record shows the bank opening in 1991 as MBNA America, taking the FIA name on June 10, 2006, and absorbing Bank of America, N.A. (USA) on October 20, 2006.

1991: MBNA America

A national bank in Delaware

June 2006: FIA Card Services

The new name

October 2006: a merger

Absorbs Bank of America, N.A. (USA)

October 1, 2014: one bank

Merges into Bank of America, N.A.

FDIC BankFind Suite, FIA Card Services, N.A. (Cert. 33318).

An account charged off while FIA existed went bad more than 12 years ago, so check its age against your state's deadline to sue before you pay or promise anything. How long a charged-off account can be reported, and why a sale doesn't restart that clock, is in charge-off versus collection.

Has Bank of America been penalized over its credit card practices?

Yes. On July 11, 2023, the CFPB said Bank of America had withheld promised credit card bonuses from tens of thousands of consumers and that, from at least 2012, its employees had applied for and enrolled consumers in credit card accounts without their knowledge or authorization, using their credit reports without permission. It ordered redress and a $30 million penalty for those practices. Earlier, in April 2014, it ordered Bank of America, N.A. and FIA Card Services to provide an estimated $727 million in relief and pay a $20 million penalty over what it called deceptive marketing and unfair billing of credit card add-on products. In May 2022 it ordered a $10 million penalty for processing out-of-state garnishment orders against customers' bank accounts. Dispute, in writing, any Bank of America card on your report that you never applied for.

How do you settle a Bank of America credit card debt, and what does it cost?

To settle a Bank of America credit card debt, make a written offer to whoever owns the account today, get the accepted terms approved in writing before any money moves, and plan for a possible Form 1099-C. None of the bank's filings gives a figure for what it accepts, so start from what you can pay; what percentage to offer on a settlement covers opening numbers.

Where the account is	Who can agree to settle	Get in writing first
Behind, not charged off	Bank of America	Plan or settlement, and every payment date
Charged off, still the bank's	Bank of America, directly or through an agency or law firm	Approval that your payment settles the whole balance
In a lawsuit the bank filed	Bank of America, through its lawyers	What happens to the case, reviewed by your own lawyer
Sold to a debt buyer	The buyer only	Proof it owns the account, and that the rest won't be resold

• Where the account isBehind, not charged off

  Who can agree to settle

  Bank of America

  Get in writing first

  Plan or settlement, and every payment date

• Where the account isCharged off, still the bank's

  Who can agree to settle

  Bank of America, directly or through an agency or law firm

  Get in writing first

  Approval that your payment settles the whole balance

• Where the account isIn a lawsuit the bank filed

  Who can agree to settle

  Bank of America, through its lawyers

  Get in writing first

  What happens to the case, reviewed by your own lawyer

• Where the account isSold to a debt buyer

  Who can agree to settle

  The buyer only

  Get in writing first

  Proof it owns the account, and that the rest won't be resold

Sale and settlement terms from Bank of America card agreements filed with the CFPB, second quarter of 2026. Not legal advice.

What a debt settlement agreement must say lists the terms to see before you pay. On taxes, the IRS instructions for Form 1099-C, revised April 2025, require a domestic bank to file one when it cancels $600 or more after an identifiable event, such as an agreement to cancel the debt "at less than full consideration." The form is filed whether or not you must report the canceled amount as income, and IRS Publication 4681 says canceled nonbusiness credit card debt may be excludable if it was canceled in a bankruptcy case or you were insolvent immediately before the cancellation. Ask a tax professional, and see taxes on settled debt.

Where Felix fits

Felix negotiates the unsecured accounts you choose to enroll, which can include a Bank of America credit card, a co-branded card the bank issues, or one already with a collection agency or debt buyer. A Bank of America mortgage or auto loan is outside its scope.

Felix is software, a debt negotiation platform, not a law firm, bank or debt settlement company. Each letter is drafted in your voice for you to read and e-sign, then mailed under your name from your return address, so replies come to you. There's no power of attorney and no phone negotiation. When an offer arrives you see the numbers plainly and decide; if you accept, you pay the creditor directly, and Felix never holds your money. If court papers arrive on an account, Felix pauses the letters on it and points you to a lawyer or legal aid.

The eligibility check is a soft credit pull that doesn't affect your score; the privacy policy covers the data. Pricing is a subscription whose base covers up to three enrolled accounts at a time, with a smaller amount for each one after that, never a percentage of your debt. No creditor has to settle, Felix can't promise a result or remove accurate information from a credit report, and the FAQ covers its other limits.