Credit Advice

Have a question? Have advice to share? The combined knowledge and experience of everyone in the Credit Karma community can help you. Enter your question or help others below to get started!

Question

Posted in Paying Your Bills
Profile Image

Question By
Frank1630

1 Contribution
0 People Helped
Settling with a debt collector
I have been making payments to a debt collection agency for a few years now. I've paid $7000 into a $17000 account but they're saying due to interest I still owe at least another $12000 to pay it in full. I have the money to settle completely but my understanding is that they pay 7¢ on the dollar to buy my bad debt, so they've made their money back, plus $5500 at this point.

How do I go about negotiating this? Does anyone have any ideas?

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW
All Responses

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next
Top Contributor
7168 Contributions
1392 People Helped
Most Helpful Response

Helpful to 1 out of 1 people

Write to them and tell them that you want to settle. Make an offer, a low offer as they will probably make a counter offer. Keep trying and keep playing the game. Make ABSOLUTELY sure that you have a settlement offer in WRITING before paying. Do some reading about "collection accounts settling for less" as you might find some more info. Basically though, negotiating with a debt collector isn't any different than negotiating with a car salesman or any other type of person selling something. Watch some episodes of Pawn Stars or American Pickers, or pick up a book on negotiating, I am sure that there are websites out there designated to help people learn to negotiate as well. If it were me, I would offer a $3000 settlement first, then go from there.

Reply by
Frank1630

1 Contribution
0 People Helped

Thank you for the insight and the info.  Does the fact that I'm already in a payment plan with them weaken my position?  In other words, if they outright refuse to settle, what would be my recourse?

Top Contributor
7168 Contributions
1392 People Helped
Helpful to 1 out of 1 people

Already being in a payment plan does weaken your position. Since they already have a steady stream of money coming from you they may refuse to settle. This is where you will have to be creative and take gambles. I don't want to advise you anything here and am not recommending what I would consider doing as it could cause you headaches if it doesn't work. If I was in this position, I might consider telling them I am done with the payment plan, I am moving out of the country for a while, I would offer a lump sum, tell them to settle for it or get nothing and then play it from there. Of course they may take you to court then if you quit paying, but would that even cause much more money with them than you owe now? Probably not much. Also read up on the FDCPA (fair debt collection practices act), maybe you can get them on something there.

Result 1-1 of 1Results per page: 5 | 10 | 25Page 1 of 1   Previous | Next

Your Credit Scores Should Be Free. And Now They Are.

View your scores and reports anytime.

SIGN UP NOW

Reply to this Question

Write your response:
Enter Your Comments

The Credit Advice pages of the Site may contain messages submitted by users over whom Credit Karma has no control. Credit Karma cannot guarantee the accuracy, integrity or quality of any such messages. Some users may post messages that are misleading, untrue or offensive. You must bear all risk associated with your use of the Credit Advice pages and should not rely on messages in making (or refraining from making) any specific financial or other decisions.