Debt Negotiation Tips
Credit Card Collector Negotiation Advice
Once you become delinquent paying your credit card statements you will begin to receive phone calls from the creditor. You might consider taking on the creditor on your own, but you should realize that these people deal with debtors every day and in order to achieve a decent settlement, it helps a great deal to have the power of a law firm like Johnson Law Group behind you.
Some say that ignorance is bliss, but anyone with an average amount of common sense will realize that it is best to know your rights. When dealing with creditors, make sure to keep a detailed record of all of correspondence. Cite the time and date of the call, the name of the individual with which you spoke, demand their name and employee ID, and detail the conversation and everything that the person said to you.
We advise that you read the Fair Debt Collection Practices Act and the Fair Credit Billing Act. Both of these acts set out rules and regulations that creditors must abide by. A number of states have enacted their own legislation dealing with fair credit practices and you can find out by contacting the attorney general's office in the state in which you live.
Prioritize All of Your Bills
Despite what your creditors tell you when you become delinquent on payments, paying the credit card company should be toward the end of the "important bills" list. Paying your monthly mortgage or rent, electric, water and phone bill should be top priority. I can be difficult living without power and water and a place to hang your hat. Buying groceries and clothes should be priority as well. You don't want to be naked and hungry. Skipping medications to pay your creditors is not only foolish but also could be very dangerous for your health.
No matter what a collector tells you on the phone, they can take no real action against you until and unless they hire an attorney and sue you. Remember that a creditor wants to collect and if they sue, the amount
Figure Out Your Monthly Debt Budget
If you are planning to try and take on these collectors by yourself, you need to figure our how much you will need to begin to save in order to eventually have a single payment amount available for a lump sum settlement. Lump sum settlements almost inevitably wind up being better for the consumer and result in a lower overall settlement. In the Johnson Law Group debt settlement program, you save your own settlement money in your own bank account and we perform the arbitration for you. When you have saved a sufficient amount to offer a creditor a settlement, say 40 to 60 percent, we contact the creditor and utilize our large client base leverage to secure your best possible settlement.
Take Control of the Situation
Remember to NEVER give a collection agency any personal information of any kind. Do not reveal where you work, do not EVER give them any banking information or post dated checks. Once they know where you work the harassment will likely begin there as well. The less a collection agency knows about you, the better off you will be. Remember that the more control you retain, the more you will be in the driver seat when the negotiation time comes up.
Record Collector Conversations
Most states require "single party consent" to tape a phone conversation, which means that as long as at least one person knows the conversation is being taped (you), it is allowable. In other states, both parties are required to be informed before taping is allowed. In this case, you need simply mention at the beginning of the call it is being recorded. The fact that they continue the conversation should constitute consent. If the creditor becomes offended or snippy, just politely tell them that you are quite concerned about the state of your account and do not want to make any mistakes in dealing with it. No reputable collector should have problems with that response.
Insist on a Settlement Confirmation Letter
If you are able to negotiate a settlement for less than the full amount owed, you should definitely insist on a confirmation letter stating that the creditor agrees to accept less than the full amount for settlement in full. No matter what sort of settlement you are able to achieve, get it in writing BEFORE you make any payments. After you've received the settlement agreement confirmation in writing, send your payment to the address shown with a copy of the agreement. Send it Return Receipt so you have proof that the payment was received.
In many debt settlement agreements there will be a paragraph that makes mention of contacting the national credit bureaus to show the debt as "settled" with a zero balance. You should ask the creditor to remove any negatives that they may have reported while your account was delinquent, such as "late pays" or "charge offs." Request these assurances in your agreement. For your own personal information we've provided links below for the big three credit bureaus.
Get Legal Debt Help
Debt collectors are generally very aggressive. These people exist on a percentage of what they can collect from YOU. Remember this at all times when speaking to a collector.
Trying to negotiate with a creditor can be intimidating, infuriating or even humiliating. Ignorance is NOT bliss when dealing with collectors and what you don't know CAN hurt you. Here at Johnson Law Group we give our clients the legal edge that none of the other companies can currently offer.
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