Asked in Debt Collection
How likely are you to get collection agencies to lower the amount of your depts?
December 28, 2012 10:59PM
It depends. If the debt is newer and you owe a lot of money, then the creditor or collection company can sue you for the debt and place a judgement on your credit report. This could end up with your wages being garnished or your bank account being levied. Sometimes, you can negotiate a lower settlement on a newer account by writing a goodwill letter to your creditor, explaining your difficult times and why you could not make the full payment.
If the debt is older, and the statute of limitations in your state has passed (which means that the creditor/collection company can no longer sue you), then you have leverage to negotiate a lower settlement. You also have more leverage if the account will soon be falling off your credit report (most accounts will be removed after 7 years).