Short answer
A verbal agreement is not a settlement. Get the deal documented in a settlement letter, check that the letter contains the items that protect you, and only then send money. Paying off a settlement without a written agreement is a mistake you will regret if the account resurfaces later.
Key points on this page
- No deal is a real deal until it is documented and then paid in line with the terms in the letter.
- A settlement letter should show the creditor or collector name, the date, your name, your account number, the amount accepted as settlement, the payment terms and due dates, and wording that the account is settled or satisfied in full. If any of that is missing, ask for a new letter.
- Never release payment information to a debt buyer, or to a collector working for a debt buyer, without documentation in hand.
- Some large banks will not release a letter until payment arrangements are set up in their system. That is sometimes acceptable with an original creditor, and only in limited cases with a collector working for one.
- Schedule the first payment far enough out for the letter to reach you, 10 days or longer. If it has not arrived 72 hours before the payment processes, demand a fax, and be ready to walk away with the funds out of the account.
- Keep a copy of every settlement letter, including the deals a professional negotiated on your behalf.
We just discussed how to negotiate debts successfully on our own, but that doesn’t close the deal…yet. Negotiating debt and paying the new agreement requires a settlement letter. In the wacky world of debt collection, debt buying, and credit reporting, paying off a debt you settle without having a documented agreement, is a mistake. And one you will regret later on if the credit card you thought was settled (other types of debt too) resurfaces in a way where a written agreement to accept less could show the account was resolved, instead of the headaches you may go through without one.
NOTE: This post is part of our Debt Settlement Guide. If you’ve missed any of the previous content, or would like to start at the beginning, please see the links at the bottom of this page.
Reaching the point where you have a verbal agreement to settle and pay off a debt for an amount you can afford is exciting, and a relief at the same time. You must be careful not to lose sight of what are still critical concerns before celebrating your success. This information will help you focus on crossing the debt settlement finish line with confidence – when your success is documented.
A Verbal Agreement is Not Enough
When you’re negotiating directly with creditors, your settlements are generally going to be reached verbally first. The verbal agreement will be for a set amount of money either paid all at once, or paid by making several installments over a set period of time, until the settlement agreement is met. It’s important that you understand the deal is not done until it is documented and fully funded, consistent with the terms and payment timelines laid out in a debt settlement letter.
Verbal communication with creditors and debt collectors are a necessary part of the debt negotiation process. How and when to communicate with creditors and debt collectors to negotiate with them is covered extensively throughout this site. Ongoing communications over the phone with your original creditors and debt collectors can progress until you have the money you need to settle.
You should not attempt to negotiate an account, or offer a settlement amount, until you have the targeted dollar amount you need to fund an agreement. It makes little sense to start negotiating a settlement amount if you don’t have the money to pay. Just making calls to “feel out the situation” wastes everyone’s time and could hurt your efforts later.
Your targeted settlement amounts will be different from one account to the next. If you’re working with someone in the network, you’ll be able to set realistic settlement percentage targets, timelines, and goals using real-time data about your creditors and the debt collectors involved.
If you are a DIY reader, be sure to participate in the comment sections of relevant page topics in order to get feedback about timing and targeting for your debts you are looking to settle. The comment section at the bottom of this page is the perfect place to post questions about a settlement letter you have received, or what you could do if you’re having a hard time getting one sent to you.
Reviewing Your Debt Settlement Letters
Reaching a settlement agreement can take one phone call, or it may take several calls over a period of days, weeks, or even months. When a deal is struck, you know that no deal is a real deal until it is documented, and then paid in accordance with the agreement.
Debt settlement letters with original creditors and debt collectors are typically a standard form that will consist of the following:
- The creditor and/or debt collectors name.
- The date the letter was drafted.
- Your name.
- Your account number.
- Outstanding balance owed on the account (this is sometimes missing and is not a deal breaker).
- Amount that is being agreed to as settlement and satisfaction of the debt (less than the full amount owed).
- Terms and amounts of payments to be made – if you are settling the account over a period of time – instead of with one lump sum.
- Date your payments must be received by in order to have met the settlement agreement.
- The settlement letter must reference that the account being satisfied in full i.e. “settled”, “settlement of this account”, “accepted as settlement in full”, “paid in full”.
The letter will have other general information, such as disclosures about settling debt. Creditors and collectors put this information in to cover themselves. The bulleted items above are what you want to see in a settlement letter to cover yourself.
Settling with a third-party debt collector means you must get the above details documented before remitting any payment towards the agreement. If the above bulleted items are missing from your settlement letter, you should request a different letter be sent to you that meets the above specifications.
Watch this quick video about debt settlement letters:
Setting Up an Agreement Without a Letter
Some of the large banks will not release a settlement letter to you until your payment arrangements are set up in their computer system. They will request that you give them specific electronic or ACH payment information over the phone first. Should you agree to this? Yes, in some instances.
If you’re experiencing a creditor or collection agency holding back sending you a settlement letter, be sure to post about that in the comments below to get feedback about how each one of your creditors deals with this prior to settling, or negotiating your agreement and setting dates for payment. This way, you know what to expect beforehand, or can navigate the negotiation and settlement process of a specific account with more confidence.
Schedule your first (or only) payment for a future day that gives enough time for the settlement letter to reach you by mail. 10 days or longer would be best.
- Make payments on the settlement from your bank account that you set up specifically for saving and funding the agreements.
- If you do not receive the settlement letter within 72 hours of when your payment is scheduled for processing, you can call and demand the letter be faxed to you, or the funds will not be available in the account.
- You should be prepared to walk away from a deal if you do not have documentation in hand before the payment date. As a caution, be certain you don’t have the funds in your set-aside account on the date you set up a payment – if you are walking away from a deal.
Providing information and setting payment dates in advance of having received a settlement letter is usually only an option I consider when dealing with original creditors, and in some limited instances, debt collectors working for your original creditor.
Do not release payment information to debt buyers, or debt collectors working for debt buyers, without documentation in hand.
There are some instances where I will recommend you record a phone conversation about agreeing to settle a debt. I always encourage you to tell the debt collector that you are recording the call and why (they refuse to send you the agreement in writing before payment is set up).
Receiving Debt Settlement Letters Via Fax
Technology has provided many conveniences and cost savings when communicating important details that require documentation. Documents can be emailed with the click of a mouse. It may surprise you to learn that banks and collectors do not readily take advantage of technology advancements. You will find that many internal recovery specialists (bank employee debt collectors), and outside debt collectors working for collection companies, are not allowed to email anything to you. One way to work around the delays of getting settlement letters mailed to you is to get them faxed to you.
If you do not have access to a fax already, you can set up a virtual fax service. This would give you a 10 digit fax number that others can send documents to, and you can receive the faxed documents as attachments to an email, or receive an email notice a fax has been sent to you to log in and download, or print.
One of the services I recommend to receiving debt settlement letters via fax is eFax.com. The cost of an efax account, or similar virtual fax services is low. Setting up a way to receive faxed settlement letters is worth the cost when dealing with time-sensitive communication and funding of settlement agreements you’ve made. Getting the settlement letter faxed the same day is especially handy if you follow some of the “end of month”, or “end of collection agency contract” strategies that I lay out on this site, and other personal finance sites.
Working with a debt settlement company, or a professional negotiator, should not mean you let your guard down about getting settlement agreements documented and in your hands. Just because someone else is handling the heavy lifting doesn’t mean you should not be concerned about having copies of all settlement letters. Be sure to get a copy of all debts that have been negotiated and funded from any professional you work with as each of your debts are being settled.
With business trends for electronic data storage, and the fact that computer systems can crash, physical documents this important should always be in you possession.
Conclusion:
Negotiating and agreeing on an amount you will settle a debt for is primarily going to be done over the phone. Once you have a verbal agreement, it must be followed up with documentation. The settlement letter should meet certain requirements before you remit payment in full, or make a partial payment. If you do not receive a settlement letter, or a letter does not include what is standard information to protect you, it’s okay to walk away from the deal. You can receive settlement letters via fax and mail (sometimes even email). No settlement letter means you don’t have a deal. Keep all settlement letters in a safe place with all of your other important documents.
Almost done. The final step in our Debt Settlement Guide is paying debt collectors after the negotiations are done.
If you have questions about your settlement agreements, please comment below for dedicated feedback, or call 800-939-8357, ext. 2 to reach me directly.
This Debt Settlement Guide includes:
An Expert Guide to Credit Card Debt Settlement
How and Why Banks Settle Credit Card Debt with You
Types of Accounts to Include in Your Debt Settlement Plan
Why Settling Credit Card Debt is Like a Race
How to Settle Credit Card Debt Quickly
How to Talk to a Debt Collector
How to Negotiate Credit Card Debt Successfully Yourself
7 Largest Credit Card Banks and How They Settle Debt
Get Debt Settlement Letters and Agreements from Collectors (you are here)
Paying Debt Collectors After You Negotiated a Settlement
Hi Michael! I had a few questions for you. A judgment was found on my credit report when my husband and I applied for a mortgage recently. I hadnt checked my credit report in a few months and it wasn’t on there back in May. The judgment shows $2491. I called the creditor attorney’s office to try and settle and offered $1200, which was all I had in the bank then. The lady I spoke with said that the actual amount due is $4100 and that this account couldn’t take a settlement…..HOWEVER, she would pass my offer on. This was on a Friday and she told me to call back on Tuesday. So I did and she said they came back with a counter offer of $2500. I can borrow that amount from my mom so I told them I could pay that. But after reading your info (thanks by the way!), I asked for a settlement letter. She said she would email it to me but I have yet to receive it. I know it’s only Thursday but is that normal? Would they delay in getting me the letter for some reason? She gave me her extension to call to make payment after I receive the letter. But I’m not sure how long I should wait for it before calling them and asking for it again. They aren’t aware that time is of the essence because we are closing on our home on 9/30 and I’m in a bit of a panic of getting it taken care of. Any suggestions on how to move forward?
You want the documentation in case they do not update your credit reports, so I would wait to get that from them. I would follow up with them on Monday if you have not received the letter by then.
Who is the attorney firm handling this?
Thanks for the reply! Blurt and Gaines is handling it. I spoke to a supervisor yesterday and got them to finally give me the letter. It has all the necessary info on there so I paid them. My other concern is that I gave them my payment information (check by phone) and they only gave me a confirmation number. They can’t send a receipt until the check clears. So I contacted my loan officer and told them the situation and they said that once the check clears, they can do a credit supplement to make sure it’s paid. I have no idea what that is! I am afraid that they won’t have proof of payment in time for our closing on 9/30. Any info on what a credit supplement is? And how long it may take with this supplement to show the judgment is paid?
Thanks again for all your help!! Your advice really makes me feel much more at ease!
Your loan officer may be referring to what is often called rapid re-score. This process is something mortgage brokers can use to get your score and loan repackaged after you resolve a collection debt on the fly like you have. How quickly that moves will vary but I have seen it accomplished in a matter of days.
Thanks for the reply! So, when they do the “rapid re-score”, is the credit agency reaching out to Blitt and Gaines and asking for proof of payment? I guess I don’t understand who reaches out to verify payment beyond what I’ve provided them with. Thanks for your help again! It’s really been awesome!
The loan officer has the ability to request the credit reporting agencies adjust their reporting as a result of material changes to your existing accounts (whether current with payments or in collection), and have documentation to substantiate those changes.
the letter i got from Northland has all the necessary bullets mentioned in the article, but instead of “settled”, “settlement of this account”, “accepted as settlement in full”, “paid in full” it says “resolved”.
it essentially means the same thing in my opinion. is it something i should be worried about?
thank you
Not in my experience. I would pay a settlement to Northland Group if it had that verbiage and everything else was in order.
Hi Mike,
I have an account that was placed with Convergent. I have a written offer from December for roughly $1800 to settle. This was not a solicited offer- it was mailed to me “out of the blue” by them. The offer gives me 60 days to pay. We are well past that time. I have reached out to them and have now been told that they can’t take less than $3400 explaining interest charges. I highly doubt this since it is only 8 months since their last offer. Anyhow, I have asked them for the settlement offer in writing and they won’t give me one. They only say that once they have my bank info, they will send a letter saying things are paid in full. I don’t want to let a deal go, but not having the terms in writing makes me nervous. As does giving them my bank information. I have reminded them that there was an offer in writing from them previously, so clearly they make these written offers in practice. They won’t budge. Any advice on how I should proceed? Thanks!
Here are a couple of options:
Call and talk to a supervisor and outline all of your concerns and the need for a letter. Many people I have worked with over the years are getting money from a friend or family member to pay, and the money or payment is not going to be released or available until the deal is in writing to show the person offering to help.
Record the phone conversation and cover all of the details. Tell them that you are recording the call and why (they refuse to put the deal in writing). Keep the recording until the letter does come, and then keep it some more.
I would not give bank account information until I got a letter or outlined everything in the recording.
Hello Michael,
I just got through posting on a different segment of the consumerrecoverynetwork regarding Midland Funding,Llc.. Assignee for Chase Bank. Basically, I acted as an interested party to negotiate a settlement for my son, as my husband and I would help him to supply the funds needed to avoid an imminent court date, We decided to do a conference call.
I negotiated a lower amount than was requested with the person who works on the debt collection line for the attorney representing Midland Funding, the attorney, Joseph M. Hall is associated with Lustig, Glaser and Wilson,PC in Waltham Massachusetts. A Summons issued to my son was delivered to him today, in Rhode Island at his residence.. The court date was supposed to be twenty days from tomorrow.
All I did was to explain that as a family we wanted to help resolve this issue but needed to know how we could find an amount we could agree upon. Since we reside in the State of Rhode Island, there is less protection for consumers than in other states. the amount Midland Funding was seeking was $ 10,640.43 and the costs of this action. I asked if they would accept $ 5000. After putting us on hold, the man returned to counter that Midland would accept $6395 which we will pay in full with no payment plan needed.. The man said that they would be mailing the settlement agreement from their office located in Waltham MA. My son said yes and we are now awaiting the settlement agreement in the mail.
I do have a few questions: Did I overlook something in just negotiating an amount? Are there other terms that I should have asked about? What can we expect to see in the settlement agreement besides the amount we agreed to pay? How should the final payment/ settlement amount be paid should we use a certified bank check, a U.S Postal Money Order and how should it be sent registered mail ,certified mail? Should we show up on the court date mentioned? We haven’t called the court for a date yet.
We were informed that a 1099 would be supplied for the amount that exceeded the agreed upon payment and would be reflected as income.that could affect his taxes.
We did not request that Midland Funding show proof of the debt as we know that my son has dealt with them as Midland Credit, in the past. This was before his fiancee passed away, his apartment burned down, and in 2007, he lost his job as a result of litigation that cost him and the whole family more that $50,000. He has gone through so much. This year, 2015, he finally obtained a job and attempted to settle this debt with Midland Credit by calling them, however, Midland Funding was now handling the account and they refused to negotiate with him. This debt is not yet ten years old which I believe would have precluded the ability to sue for any monies due them.This represents the highlights of all that has happened..
We would like to thank you for taking the time to answer our questions and hope that you can supply some much needed advice on what to do at this point.
Cross reference all the critical points I bullet in the original article above when you get the settlement letter from the Midland Funding attorney.
Whether I would suggest your son still appear in court will depend on the contents of the letter. Post more details when you get it.
It is not necessary to request a debt be validated when you recognize the debt as your own and simply wish to resolve the matter.
Hello Michael,,
I was unable to post a comment to give you an update on this site and do not know why. I waited for several days to be sure that you had not received my follow-up / update.
I, therefore had no choice but to do the following:
1- I checked the bullet points from the information you had originally posted.
the following are the important excerpts from their letter.
2-“…..Please be advised that our client has agreed to accept the sum of $ 6395.00 in full settlement of the above account provided said amount is received by our office on or before August 25,2015. ….Upon receipt of the settlement amount we will advise the Court that the claim has been satisfied.
The payment had to have been received in “a timely fashion” or the settlement shall be deemed null and void and any funds received will be applied against the full balance due on the account.”
On Monday, I had a cashiers check for the full amount made payable to the law firm, as indicated with an RE: Midland Funding and with the File number assigned from the law firm and with my son’s name. and sent this with the payment coupon Express Priority mail and signature required and tracking provided. The tracking number showed as having been delivered to the Waltham Post Office Box and signed for by a company employee .
I took three copies of the letter of settlement agreement.and envelope, for our records.
Should my son answer the summons or appear in court anyway?
Thank you for your assistance and any answers you may provide.
Thanks for the update M.L. I am always reachable by phone at 800-939-8357, choose option 2. Sorry you had trouble posting your prior update (it did not publish to the site).
The verbiage you shared is all standard and will meet your needs. I do encourage people to show up in court when there is a date already set in the near future, even after reaching a resolution like you have done. I only suggest this because of the potential for a mistake where the attorney at court that day does not have an accurate record of events (not common, but if you do this work this long you see it enough to encourage people to do something that prevents it).
What is the date set for the appearance?
Evening Michael,
Thank you for the swift reply.
The date was 20 calendar days after the date of serving the summons..(not to include the day the summons was served.) The summons was served on August 11, so countng from August 12, I estimate Monday, August 31st.
For the sake of your readers, if a summons is served in person by a sheriff or constable you only have twenty days to answer the summons. or you will lose by default and the judge can award the entire amount stated in the summons to the plaintiff and cour costs.. If a summons is sent via mail, you have 30 days from the date you receive it in the mail.
I tried to call Superior Court, but it was crazy busy. It is often faster to just go and find out what my son needs to do next. I made all those copies, just in case we need them. Hopefully, the clerk there will know what we should do or if we need to file an answer to the summons.
Actually, I believe that the attorney that they have listed as sending out this letter, is based in Newport, Rhode Island. The chances are that I can probably reach him.
The cashiers check is drawn on my credit union, but it could take a few days for the money to actually be available by whatever bank the law practice uses. That is one of the reasons I wanted to get the payment process completed on our end. I didn’t want them to have any excuse for saying that the funds weren’t available to them on or before the 25th of August. We have no problem showing up for the court date. I just remembered that Rhode Island court system is online. I can get the information by looking up by name and or using the case number.
Thank you again for your help. I will post an update after the court date so that your readers get an idea of what to expect. God Bless you for starting this website.
Yes I want to start the process. What is the best thing to do?.Do you think I should wait if it is close to the 7.5 years.
What is the amount Commonwealth Finance is trying to collect from you?
They reported $657.00
You could settle for some savings and reach your goals sooner. Decide whether it is worth a few hundred dollars to start home shopping early.
Good morning Mike.
I finally received settlement offer from Commonwealth. I have proof of my settlement. They would not report paid in full but would report paid settlement and if I decided to go back to Sprint I would have to paid the remainder balance. My money order has been sent CCRR. Thanks
Congratulations with getting your Commonwealth collection resolved SherrieD! I saw your other comment post about getting ERC settled too.
How many accounts do you still have left to contend with?
I have one more offer that is Military Star, that will be sent soon. I have education payments that I will double up on soon. I hope my credit score will increase soon.
Thanks Mike
Hi MIke,
I am back with more question. First, Enhance Recovery has accept the settlement but they are reporting it as collection settled. Do this verbiage effect the credit?
Second, I informed you that NCC accepted my settlement. Now they have sent me another collections. When I call and made arrangement to settlement. I asked did the settlement cover all three. He stated that it was the $657.00 and the two little account for $40.00 and $30.00 he company could not report on my credit report by themselves, But on September 29, I received a collection for $40.00. The notice states I should dispute withing 30 days. Well Mike, I call Touro to find out the days of this invoice and was told by the agent that this bill was paid. I am request a copy of paid bill that will be submitted to NCC. Can I report them to FBPC for false claim and stating that they can not report medical under $40.00. I believe that I have this conversation recorded.
What is your opinion?
Settling a collection account and getting that fact updated (a zero balance owed with paid/resolved/settled) is normal and what you can expect in nearly all instances like this. The verbiage is not an issue when you settle charge off debts in collection.
I would send a written dispute certified mail regardless of what was said on the phone,and yes,I would suggest filing a collection complaint with the CFPB.
Hi Mike,
What is the least amount of debt that can furnish to your credit report. I just talked to the hospital. I was told that this debt was forward to a Law Firm. Well last year I disputed the entry because I had received several statement saying “this is not a bill’. We I don’t remember if it was one of the disputes entry since the Firm had them removed. The hospital does not keep the bill no longer then 4 months. Only they the Specialist can tell me is that service was rendered in June 2010. I don’t want this on my credit report. I want to dispute because I have a secondary provider. And I have to 10/29/15 to dispute with NCC. What should my next steps be.?
I have managed to increase my credit score with Equifax to 717 and Transunion to 680. I believe this entry will bring it down. Thanks for any assistance you can give me.
I would file the dispute and see what information that yields.
I have seen collection accounts as low as a one hundred dollars appear on credit reports.
Good morning Mike,
Referencing my above situation. I just discovered that NCC/Commonwealth Finance System, Inc. had no right to collection on this medical invoice. I spoke with my insurance and secondary provider who states, as a patient I had to no patient responsibility to pay. I have records showing no payment due. Can I get NCC/CFSI to refund my money. I have sent them evidence that this was a false collection. They have report to the credit agency for over a year report this as a debt. What else can I do to get my money return. Do I need to report to CFPB. Thanks for your help again.
You have been a life saver.
I would file a collection complaint with the CFPB if the money is not returned to you on your first request.
Hi Mike, I have another issue. I just reviewed my credit report thru Credit Karma who is stating that Transunion has added another collection. This is Commonwealth Finance. I have not received any letter or documents from them. They had an entry on my credit report before but it was removed. Now they have returned. Should I contact them and ask for a d/v letter then offer an settlement. This is a hospital debt but I don’t know which year it was establish. You see in 2009 I had heart surgery and a couple the invoices received from the hospital stated ” this is not a bill” but later refer to collection. I kept some of the paperwork. Commonwealth Finance just place this collection on my report 7/18/15. But I have not received anything from them (no letter or calls). What advise can you give me?
I would want clarity on the bill from the service provider and cross reference any of that with what insurance covered. If this debt is 6 years old it should drop from your credit reports soon. The age of this debt can also make it hard to research.
Are you going for a home loan anytime in the next year or so?
They have refused to put the tax disclosures on the letter (I brought it up several times before). The guy said it’s the risk I had to take. I persisted. He put his ‘supervisor’ on the phone who preceded to tell me that I didn’t know what I was talking about and she would not sign off on it.
So I told her it’s too bad that we negotiated this far and to have this little clause be a deal breaker. Then she put her ‘supervisor’ on the phone with me. This last guy said he would work on putting that clause on the letter. We’ll see.
Thank you for all your advices. You have done great services for those of us who are not used to dealing with these issues. I had just decided to settle with Atlantic Credit & Finance in VA (original creditor was Citbank). The amount due was $16,202 and the settlement amount is $10,531. $531 is to be the 1st installment and $225/month for 44 months. ACF wants to electronically draw the funds from my account. I don’t feel safe that they have my bank account information but it is the only way they will settle. Is it common for the collection agency to do that?
Would it be possible for me to upload the settlement letter with the payment schedules (or I can type it here) for you to review? Just want an expert opinion on this settlement in case there is something I missed.
Thank you for your time.
It becomes much more common for debt collectors to want to schedule ACH drafts from your bank account when the deal you negotiate involves so many payments over that long a period of time.
Post a comment reply with the details of the agreement to settle with Atlantic Credit and Finance and I can offer more feedback from there.
Hi Michael,
Here is the settlement letter:
Original Creditor: CITIBANK, N.A.
Original Creditor Account #: xxxxx
Current Creditor: Atlantic Credit & Finance
Special Finance Unit, LLC (‘ACF’)
ACF Account #: xxxxx
Balance: $16,202.33
Settlement Amount: $10,531.51
Dear xxxxx
Atlantic Credit & Finance would like to offer you the arrangement listed on the reverse side of
this letter in order to resolve your account.
Once you have completely fulfilled your payment arrangement, and in the event that Atlantic
Credit & Finance is reporting your account to the credit reporting agencies, we will report to the
credit bureaus that your account has been satisfied and ACF will release you of the obligation.
We are not obligated to renew this offer.
If this is not what you agreed to, please call your representative
In reference to ACF account # 4642521, we would like to offer the following payment arrangement:
This arrangement contains 47 payments totaling $10,531.51 to be paid between 07/31/15 and 04/05/19.
07/31/15 $200.00
02/05/16 $225.00
[Edited to remove monthly payment duplication]
I have a separate account that I can use for the purpose of handling the debts as you advised. Is there anything else I should be concerned about?
Thank you for your time.
Given the collection agency involved, and the duration of payments you needed (in order to afford some kind of deal at all I assume), the letter would be okay for me if I were in your shoes.
Couple of things:
How long ago was it you last made a payment on this account to anyone?
Are you 100% confident you can pay the $225.00 monthly?
Last payment to Citibank was in November of 2014. I’m quite sure I can pay the $225/mo. For $225/mo, they will settle for $10,531. I figured it’s a fair amount since I do owe the money.
They did say I could spread it over longer period and ‘renegotiate’ the balance along the way and there’s not prepayment penalty. I just want it to be over with sooner. Do you think I should start with a lower payment and just pay more when I can? It will make first few years a lot easier on me. I think I will go back and negotiate $130/mo for 77 months. What is your opinion?
Is AFC a reasonably reputable company? BBB has lots of complaints on them.
Again, thank you so much for your time.
I would be looking for any opportunity to save up and offer about 30 to 40 percent of the balance owed as a settlement. That goes for today, or 20 months from now.
Atlantic Credit and Finance is an established collector who I would categorize as one of the easier to work with to resolve debts.
You will be hard pressed to find a legitimate debt collector without BBB complaints. It is the nature of the business.
Calling back to get a longer time frame could impact the structure of the deal. Let me know what they say.
Hi Michael,
I got this today from ACF. I’m ready to proceed with this arrangement if you think there is nothing ‘fishy’. They are pushing for bank information in a way that made me uncomfortable. But it’s probably nothing.
Original Creditor: CITIBANK, N.A.
Original Creditor Account #: xxxxx
Current Creditor: Atlantic Credit & Finance
Special Finance Unit, LLC (‘ACF’)
ACF Account #: xxxxx
Balance: $16,202.33
Settlement Amount: $10,531.51
Dear xxxxx
Atlantic Credit & Finance would like to offer you the arrangement listed on the reverse side of
this letter in order to resolve your account.
Once you have completely fulfilled your payment arrangement, and in the event that Atlantic
Credit & Finance is reporting your account to the credit reporting agencies, we will report to the
credit bureaus that your account has been satisfied and ACF will release you of the obligation.
We are not obligated to renew this offer.
If this is not what you agreed to, please call your representative right away at 1-800-888-9419 to
discuss the best possible alternative.
Thank you for your cooperation in resolving this matter.
OUR OFFICE HOURS ARE 8:30 A.M. to 9 P.M. EST MONDAY – WEDNESDAY, 8:30 A.M.
to 5:30 P.M. EST THURSDAY AND 9 A.M. to 5 P.M. ON FRIDAY
In reference to ACF account # xxxxx, we would like to offer the following payment arrangement:
This arrangement contains 79 payments totaling $10,531.51 to be paid between 07/31/15 and 12/20/22.
07/31/15 $200.00
04/20/16 $130.00
[edited to remove monthly payment duplication]
Sorry to post all the payments. I just wanted to present all of the info that I have. Thank you!
The typical tax discloser about forgiven or canceled debt appears to be missing from the letter, but the content of the letter I could use effectively if any later mistakes were made with my account.
They have refused to put the tax disclosures on the letter (I brought it up several times before). The guy said it’s the risk I had to take. I persisted. He put his ‘supervisor’ on the phone who preceded to tell me that I didn’t know what I was talking about and she would not sign off on it.
So I told her it’s too bad that we negotiated this far and to have this little clause be a deal breaker. Then she put her ‘supervisor’ on the phone with me. This last guy said he would work on putting that clause on the letter. We’ll see.
Update: I call them 3 hours after that last conversation to follow up on the letter they were going to email me, I asked to speak to the last ‘supervisor’, I got his voicemail. Then I asked to speak to the guy I’ve been dealing with, got his voicemail. I left mssg and so far no return calls and no email which is unlike these collectors.
So, did I stir up something they purposely omitted (the report of the discharge amount to IRS). I am anxious to settle this but I now I feel uneasy. I hope I don’t have to renegotiate again because I am ok with the settlement arrangements.
Any thoughts?
Thank you!!
The tax disclosure is not a deal breaker. It is something companies do to cover their own butt, not really yours. The absences of the disclosure is an oddity, and something I pointed out because it is so common, to not see it is noteworthy.
I would not care if it is on there or not, and would not let a deal pass me by over this.
Thank you. Still waiting for them to contact me one way or the other.
I have a trial scheduled with Midland Funding. I negotiated, and received the following as a settlement letter via fax. Would you have time to review this?? Could they still try to collect court/attorney fees if I pay the settlement amount by the due date? The current balance due is the original amount, and the settlement amount is what we agreed upon. I replaced those with x’s below. The wording is real fishy as it says the “settlement amount” may or may not include principal, interest or other charges that may apply to this account.
Thanks so much.
2015/07 /23 12:56:53 2 /3
July 23, 2015
Dear xxx,
Contact Information: Tel.: (866) 300-8750
Facsimile.: (877) 411-6864
P.0.Box2121, WarrenMI48090
Current Owner.: Midland Funding LLC
Original Creditor.: CITIBANK, N.A.
Original Account No.: XXXXXXXXXXXX-8115
Internal Legal Account No.: xxx
Visit Us Online at
http://www.midlandcreditonline.com
This letter confirms the parties’ mutual acceptance of a settlement on the above-referenced account based on the
following terms:
Current Balance DueA as of July 23, 2015: $xxx
Settlement Amount: $xxx Due Date: July 29, 2015
When your account has been paid in full, and if data related to your account is still being furnished to the
consumer reporting agencies, the three major consumer reporting agencies will be notified that the account has
been paid.
The Current Balance Due includes principal, other charges that may apply to this account as of the date of this
letter. The settlement amount may or may not include principal, interest or other charges that may apply to this
account.
By you entering into this settlement arrangement and making the agreed payment, you ackowledge the
existence, justness, and amount of this claim. Please sign this letter and return it with the agreed payment to PO
BOX 939050 SAN DIEGO CA 92193-9050. If you have already established payments by other means, then
please return the letter only.
When your account has been paid, and if data related to the account is still being furnished to the consumer reporting
agencies, a request will be made of the three major consumer reporting agencies to report Midland Funding LLC’s trade line
related to the above referenced account as paid. We will report forgiveness of debt as required by IRS regulations. Reporting
is not required every time a debt is canceled or settled, and might not be required in your case.
Important Disclosure
Federal law prohibits certain methods of debt collection, and requires that we treat you fairly. You can stop us from
contacting you by writing a letter to us that tells us to stop the contact or that you refuse to pay the debt. Sending such a
letter does not make the debt go away if you owe it. Once we receive your letter, we may not contact you again, except to let
you know that there won·t be any more contact or that we intend to take a specific action.
If you have a complaint about the way we are collecting this debt, please write to us at 2365 Northside Drive, Suite 300, San
Diego CA 92108. email us at cu:,iqrnerservice(l>rncm,a.Gqm, or call us toll-free at 800-265-8825 between 9:00 A.M. and
5:00 P.M. Pacific Standard Time, Monday- Friday.
The Federal Trade Commission enforces the Fair Debt Collections Practices Act (FDCPA). If you have a complaint about the
way we are collecting your debt, please contact the FTC online at http://www.ftc.gov; by phone at 1-877-FTC-HELP; or by mail at
600 Pennsylvania Ave., N.W., Washington, D.C. 20580.
The balance listed above includes any charges that may apply to this account as of the date of this letter. In addition, charges
may continue to accrue on this account until the account is satisfied, and We may have incurred additional costs and
connection with lawsuit. Thus, the amount we may be willing to accept in settlement of the lawsuit may be greater than the
total amount above. We are not obligated to renew this or any other settlement offer.
No tricks in there. The reference to may or may not include fees and interest is just CYA stuff. You are agreeing to pay Midland Funding a reduced amount. If that amount is agreeable, it is not contingent upon anything else than your ability to afford it.
Nothing wonky with the legal fee reference at the bottom.
I would take this letter and confidently settle with Midland if the debt were mine.
Hello michael,
I was terminated from my job 2 years ago, i did my best to pay all the credit cards. I will be getting a sum of money that i would like to eliminate my debt with, 2 small bills $76 and $136 have went to collections and 1 $6500 from citi has been charged off, all 5 of my other accounts are current, i have sent letters to most of my creditors asking for a settlement at roughly 50%. I have 2 questions, 1st how long does a response usually take feom the creditors? And the cards im not late on how likely are they to settle? I only told them im unemployed, and can no longer maintain payments,i did not mention the sum im getting. Thank you.
To add to that the sum would not elliminate my entire debt without settlement.
I generally do not advise negotiating or proposing settlements in a letter you send. It is different if you get a settlement offer letter from a creditor or collector, but even then, I encourage you to call in to counter offer.
You often will not get any response to your letters at all.
You often reset the SOL to sue with written acknowledgment of the debt and offer to pay.
It is best to put the deal together on the phone, and then get everything in writing before you make a payment.
The accounts you are current with will tend to have no ability to settle for less. Not until you are behind, and for several months, will settling for less be an option they can discuss.
It would be a good idea if you called me for a consult. I can be reached at 800-939-8357, choose option 2.
Good afternoon Mike,
On a previously website you indicates that you had information “concerning the best time to request a settlement or to negotiate. i am request an settlement with ERC. The debt is $595.00 but they are request that I settlement for 303.00. Is this a good deal? ERC wanted me to provide banking information before receiving a settlement letter, an addition to post dating a check over the phone. Is this illegal? What is the best deal to settle? In a previous blog you stated that I should record the conversation, can this be use in lieu of settlement letter from the collection agency.
Smaller balance debts do not always settle for the best rates. 50 percent is not all that bad a deal on this amount.
If I wanted to get a settlement done, and they simply refuse to document it before the payment is in the system, I would indeed record the call start to finish, hit all the highlights, and fully identify the speaker, etc., before setting up or making payments. I would keep that recording in a safe place (backed up on my computer and one or two additional hard backups).
I would tell them I am recording and why (they refuse to send the deal in writing).
Hello. I have been attempting to settle a debt with First Financial Asset Management. They absolutely refuse to give me a statement in writing detailing our verbal agreement for repayment. I want to pay this debt, have agreed to pay $200 a month over the next 48 months to pay this debt in full, but it is “not their policy” to send out letters, emails, or fax statements showing the agreement. Is there any law that requires them to furnish documentation of a verbal agreement? Thank you in advance for your assistance.
Oh, yes, it is a valid debt! We’ve already verified it. I just want to pay it, set up an allotment to have it paid every month, and move. All I want is something in writing.
There are only a handful of states that require collectors to put agreements in writing. What state are you in?
You can also record the conversation you have with the collector at First Financial Asset. Keep that recording and a copy of very thorough notes of everything that was said, by whom, and on what day and time, leading up to that phone call. It will help if you need to resolve a dispute later.
Mr. Bovee,
I have a question regarding settling an old credit card debt.
I opened a credit card account in 3/2006. The last payment I made was in 6/2013. The account was charged off in 12/2013.
Last week I received a letter from US Bank and Portfolio Recovery Associates that this debt was sold/purchased by PRA. The amount is $5,555.88. This debt is not time barred in my state (not for two more years) but regardless, I’d like to settle with them to just get this over & out!
My question is this…. in your experience and professional opinion, do you think they’d accept a final offer of $2,000? I’m hesitant to contact them until I’m feeling more confident about this offer because it’s the max I can do!
Thank you,
Carmen
I will leave my reply for any other follow up information you post because of how much we covered in the phone consult.
For the benefit if other readers I will say again that realistic settlement percentages with PRA tend to be around 50%, but a tad lower is possible when conditions are right.
Hi Michael!
I did read a lot of the comments here before posting, and I did watch some videos after we spoke. I’m giving a lot of info you already know in case other readers might be helped.
I called Professional Recovery Associates and they gave me a nice song & dance. The first woman I spoke with (after I told her my story) said they would work with me, and passed me on to her supervisor. Again, I explained my circumstances & my desire to send a certified check via certified mail to settle the $5,555.88 for two grand. I was put on hold…offered a settlement of $4500. Again, I expressed my desire and the amount available…another hold, then an offer of $3,100. What they REALLY wanted is my $2,000 as a don payment and then to make payments for the rest. No, thank you.
Lady #2, (the supervisor) said that, “…before I go to our vice president to see about cutting this further you have to be willing to come up on what you’ll pay.” I told her I could go up $100, maybe two….but that was not enough for her and I could hear her trying to get tough.
I told her I didn’t want to get into a payment plan, I just want to make a one payment in full on a negotiated amount. They really want my bank account number, to make a “…secure payment, that will be insured through my bank and I won’t have to worry about it getting lost in the mail.”
I told her I’d think about it and call back. She warned me I’d have to begin negotiations all over again. I told her that is fine. I asked if should call her, or the first lady, she said no, just call. They told me they only have had my account for two weeks and could tell by the payment history (prior to the default) was excellent so they knew there was an event that occurred.
I will call next week & see what happens.
Thanks again!
Carmen
Our B of A account is in the hands of Couch Conville Blitt. The amount of debt is 18,800. We are fortunate enough to have a family member help us pay off this debt. So we talked to Couch and made a settlement with them for just 11,000. We had to make a first payment of 3800 that week and we asked them for a settlement letter which they said they would mail us one. Its been a week now after making that first payment and the next one is due on july 30 but still no settlement letter in the mail yet. Should we be worried there’s no settlement letter yet? Should we keep bugging them to send one?They seem very professional and hopefully they can be trusted!
I would call and cover the details of the settlement you negotiated and record the phone call. Let them know you are doing so, and then request the letter to be sent again as something may have prevent it from getting to you.
I would also suggest you have good notes at this point of all prior conversations with them, including dates and times of who you spoke with. This is all just in case and while things are more fresh in your mind.
Hello Michael,
I hope you can provide a second opinion and help me sort out my doubts and relieve some of my stress regarding a settlement letter from MCM. The figures used are approximate.
I retained an attorney last month to help me settle one debt collection lawsuit (for about $2500) and settle another collection account (for $30,000) which has not yet gone to a lawsuit. Both accounts are with Midland Credit Management, and are debts that I recognize as valid.( I defaulted in early 2010).
My question is in regards to the $30,000 account.
My attorney, after just a couple days of negotiations, received a faxed settlement letter from MCM and he thinks its fine, but when I looked at it carefully, it makes me very nervous.
The letter has the main bullet points outlined in your article (name, date, account numbers,payment terms, MCM letterhead, and its being sent by a verified account manager at MCM, etc etc) but my question is that I think the wording of the letter and the payment terms is fuzzy and confusing to me , so much that I think the letter is open to misinterpretation, not in my favor.
First, to clarify, I am now able to fully pay a $9000 lump sum to settle the $30,000 balance ( which was originally about 24K , plus interest since 2010 till now) . MCM had been sending me settlement offers by mail on this account for quite a while (which I had ignored), including one for $9000 lump sum, but they stopped sending the offers in March 2015 , about the same time the other smaller account went into legal, and is now in lawsuit. This settlement agreement has already been funded and payment sent to MCM last week, but I am very nervous that I may have been too trusting of my attorney and I am extremely anxious of a possible bad outcome to this.
The pertinent wording on the current settlement offer is as follows:
———————————————————————————————-
“Dear (my name)
Congratulations on taking the first step to resolve this debt. This letter confirms the settlement arrangements on the above reference account, with an exising balance of $30,000.
The settlement terms we have agreed to are as follows:
Agreed-Upon Payment Amount: $9000
Initial Payment Amount: $8000
Initial Payment Due Date: 6-29-2015
Monthly Payment Amount: $1000
Due Date: Last day of each month
This settlement arrangement is made in good faith and is contingent upon payment of the total settlement amount. If the payment instrument is returned “not paid” for any reason, this letter will be null and void. In the event you fail to make all payments on time and as agreed, this agreement will no longer be valid. After receiving your final payment, we will consider the account paid*.
Should you have any questions regarding your payment arrangement or for further information, please don’t hesitate to call me at #####, ext ###.
Sincerely,
(Name), Account Manager
*If you pay your full balance, we will report your account as Paid in Full. If you pay less than your full balance, we will report your account as Paid in Full for less than the full balance. ”
—————————————————————————————————-
At the end is a payment certificate stating Amount Due: $9000 and due date 6-29-2015.
Also, the faxed letter does not show a signature by the Account Manager, although it is confirmed that this Account Manager spoke by phone to my attorney.
My questions and doubts have to do with the fact that I am not sure what this letter is saying!!
The letter uses the term “Agreed Upon Payment Amount” = $9000, but then later uses the wording
” total settlement amount”. So are those two terms interchangeable? Is the “total settlement amount” in fact = $9000??
and I am nervous about the wording of a $1000 monthly payment being due “last day of each month”. I clearly told my attorney I wanted a lump sum payment and funded an escrow account with more than the $9000 lump sum payment, but my attorney said it was written that way
because during negotiations she stated that I only had $8000 on hand and needed to secure an additional $1000 as a negotiation tactic to get them to agree to the $9k amount, and my attorney said something to the affect of “thats the way MCM writes these letters up” or “thats the way they do this”, but absolutely assured me that the “settlement amount” is $9000.
What do you think? I am absolutely nervous and anxious about this, and we have not heard anything back yet from MCM even though the full $9k check was sent on June 23.
I absolutely hope you ultimately tell me there is nothing to worry about.
Thank you so much for your time,
Jorge
Thanks for taking the time to post all of the Jorge. I think you have nothing at all to be worried about. With this letter (keep it in a safe place), and the proof of payment, you could fix any error or omission, should one occur.
If something does go wrong, in any way, post an update and lets go from there. The vast majority of settlements go smoothly, and that goes for Midland Credit too.
Dear Michael,
Thank you very much for your prompt reply and it definitely helps alleviate my fears. I will certainly post what outcome results from this.
Thanks a million.
Michael,
Just to further clarify what my fear is, I am afraid that they will take my $9000 payment as just a payment and not a full settlement payment and will expect me to keep paying $1000 a month until the entire $30,000 balance is paid. Am I being overly paranoid? and if not, why do you think they are so loose and undisciplined with the terminology they use in this letter? Is this kind of stuff typical, I wonder.
Yes, you are being overly paranoid. There reference to the 9k being the agreed upon settlement is in what you shared. The normal disclosures I expect to see in a Midland settlement agreement are there (about credit reporting a settlement).
You are all set, and with a good settlement deal too.
Should I start to worry now?
My debt settlement payment was due June29 and my attorney told me she mailed the payment on June 23, but now I find out she used regular mail only. As of now, MCM says the payment has not posted yet.
I assume “posted” means the check arrived at their office and is logged in as payment on the account. So the deadline has passed and they have not acknowledged receipt of payment, to me this is a disaster because potentially they can cash the check and not honor the agreement since they could say it did not arrive in time.
I have lost sleep over this and this development does not help.
I spoke to my attorney and she says to wait until Monday to see if it posts, and that the MCM accounts manager person emailed her to the effect that she will still honor the settlement. My attorney says if nothing posts on Monday then she will do a stop payment on the check, but of course, my fear is that MCM may have already deposited and cleared the check, hopefully I will find out on Monday.
To me, these kinds of things continue to indicate incompetence on behalf of my attorney and I should not have trusted her…I hope I am wrong.
If the rep at Midland Credit sent an email saying they will honor the agreement than you have little to worry about.
I understand the concerns about debt collectors, and every step should have been taken to get the payment confirmed by the expiration date of the settlement agreement. Was this a situation where you were sued and hired the attorney, or did you enroll in a debt settlement program with an attorney?
Hello Michael,
Thanks for your reply.
For this account, I hired an attorney to settle this particular debt since she was also helping me with a lawsuit on another debt with the same creditor, junk debt buyer, MCM.
This is the latest as of today July 6 morning:
The MCM account manager has informed my attorney that the payment posted on July 2, and has indicated by email to my attorney that the debt is paid and that a “paid letter” will be sent by MCM within 30 days.
My questions and doubts persist. The payment posted outside of the due date , which was June 29. I get the feeling that the paid letter (which I presume is the same as the “letter of satisfaction”) is created by someone else at MCM, not that particular account manager that my attorney has been emailing and communicating with, what if they use the date of posting as an excuse to say that the payment arrived late?
Is this 30 day period a standard, usual, typical amount of time, why do they take so long to send out this letter? that means I have at least another 30 days of worry in my chest ahead of me.
Your opinion would be greatly appreciated.
Given the update you provided, I have no worries at all. You can even use the communication they sent your attorney later on with a regulatory complaint if need be.
The 30 days turn around time on confirmation letters like this is normal.
While you do want to be hyper aware of the details when dealing with debt collectors, try not to take it to the point of losing sleep or other manifestations. If something goes awry I can help you, and just with the details you have provided so far.
Hello Michael,
Thanks for your reply.
To finish properly answering your previous question, on this particular 30K collection account, MCM had not gotten to the point of suing me yet, all they did was stop sending me offer letters in the mail, last one was February 2015. They sent another , smaller debt of $2500 to attorneys and filed a lawsuit on that in small claims court in May 2015..
My question remains, should not my attorney have sent the payment by some sort of registered method so that , as a minimum, we would have proof of when the payment was mailed? Is that not proof of incompetence by failing to do that? My attorney gets very rude and testy when I ask questions, so , like an idiot, I was also afraid to ask her if she did something as basic as sending a 9K payment by registered mail….I fully blame myself for that, but she should know better!
I have another large credit card debt collection account remaining after this one is hopefully cleared up..and I do not want to go thru this attorney for that other account, which is with Cavalry SPV I, LLC.
This one is also for about 30K.
Cavalry has sent this one to the attorneys and they sued in August 2014 but could not find me to serve me so the suit was dismissed in Feb 2015 , without prejudice, so they still have until December of this year (SOL)to refile a lawsuit. I may need your help in settling this one, please advise on what you charge on something like this. Thanks
I would have handled payment differently than she did to insure timely delivery, but she has the back up she needs with her later communications to and from Midland Credit.
As for the Cavalry account, call in for a consultation at 800-939-8357 and choose option 2 so I can get into the details of that account and your ability to deal with it. As far as fees go, they will not be more than 15% of the savings achieved. Actual fees cannot be known until the deal is negotiated and put in front of you in black and white, and then accepted by you.
Michael,
This is company collecting from me https://www.bh-pllc.com/ in regards to a LVNV account that has a judgement against me. I checked my credit report and the judgment number he gave me was what I showed on my credit report. They say they cannot send me a collect agreement until I give them payment method. This scares me but I assumed that I had no other recourse for fear they would garnish. I set payment up for Friday for one time payment. Let me know your thoughts. Thanks
sorry did not mean to double post. My browser did not show my post so I thought it got deleted or didn’t post.
The settings for the comment system are tight. Any comment that includes a link has to be approved before it goes live.
I would not have done it that way, but it will likely be okay. If it were me I would call them and rehash the deal and record the call (letting them know why). I would keep the recording until the written agreement shows up and then I would keep the recording for longer.
You should also take notes of all the calls, what was said by whom, and the not the date, time of day, and the numbers and extensions you called or that called you.
So you would let them know that you are recording the call also? Thank You for your help
Absolutely I would, and even offer an explanation as to why you are recording (they refuse to put the deal in writing).
Thank You
Michael,
On the recording do you think it matters that I didn’t get him to state the company name?
He did say his name as Mr. Green but not company. I forgot to ask him to say it.
Thanks
Ben
With all of the other bread crumbs, you have a trail the size of a city sidewalk that leads to the identity of the debt collector. If it were me I would have no problem with it.
Michael,
I have paid this off and the law office keeps telling me they sent notification to me that it was paid. But I have not seen the letter yet and it has been about 2 months. Do you have a recommendations on what I can do?
Thanks
Ben
I sent a debt settlement letter to a couple of creditors . How long should it take themto reply back if they accept it or not?
Many will not respond to written offers you send. If you are writing to one who has a reputation for responding, it can take a couple weeks.
Who did you write to?
Why have you chosen to send letters instead of negotiating over the phone?
Midland Credit Management sent me an offer to settle a several-years-old $10k credit card debt in IN for $3k, but I did not get the letter until after their stated due date. Then I received a “pre-legal notification” that they had tried to contact me and are now “considering forwarding this account to an attorney for possible litigation.” I called them and asked for a similar offer to be resent to my current address in NC so that this could be finally settled. Now they say my account is in a different department since I did not respond, so the least they can accept is $8600. They would not let me talk to anyone but “my account manager” when I called back in hope of talking to a different person with more options; everyone there seems to sound like the same Hispanic guy with different American-sounding names! (Joe, Daniel, and Scott so far) Obviously, they are “all” looking at a computer screen with the last number I was told.
I have read everything on your excellent website, but am unsure how to proceed. Do I keep calling “Joe” trying to wear him down to the original $3k ? Or does the fact that I called tip him off that I care and surely have less ability to tolerate this business than he does? (I lost my job in 2009 and am just starting on social security as husband got cancer and died last year. I had five credit cards in my name that went unpaid; three ended collection attempts in 2014 and sent me 1099’s for discharged debts, one I settled for about 40% last year, and now these guys show up.) I have no other income but an inherited retirement account that is taxed big-time if I withdraw anything…and it has to support me and disabled son for 30-50 years or so. Your honest advice, please: should I just give “Joe” whatever he wants and worry about our future later, or hang on and try to negotiate further, knowing we need that extra $5k more than Midland does?
Thanks much—Jan
You definitely need that 5k more than Midland does. Something about your account appears to be causing them to be sticky on the amount they will accept. The 3k auto generated offer can be based on different criteria that may be the result of a computer algo, where what is being looked at now is with a more critical view. I can dig a little deeper with you in a consult if you like?
You can email me back at the address you get these comment notifications from.
Hello Michael,
I recently contacted the offices of Kimball Tirey St John in San Diego. I Called to negotiate a settlement of a judgment filled against me. The collections manager I spoke with initially told me that his client would accept no less than 50% of the amount levied against me and two other members of my family. He later agreed to propose a %25 percent payoff to his client and call me back. When that didn’t happen I called once again.
This time the same person told me that 50% was the best that could be done. I offered to pay that amount so long as I could have the agreement to settle in writing. He went on to say that the Attorney’s at his office will not allow him to put anything in writing because the case is now closed and has passed the statute of limitations for collection. I asked to run that by a manager but was denied I was told that The best I can do is “take a leap of faith”, that he’ll do what he says. I don’t think I’m asking for anything out of the ordinary:
-The amount to settle
-Agreement that it will be reported as Paid Collection
-Closure for all individuals effected
He also said that even if I offered to pay the amount in full they would put nothing of our conversation in writing. This issue is really hurting my ability to secure housing but feel I’d be a complete fool to send my money with absolutely no guarantee. So I’m stuck do I have any recourse here?
Regards,
Ricardo C.
Thanks for sharing that information about the Kimball Tirey St John law firm. Never take a leap of faith with a debt collector. Can you tell me the name of this particular debt collector working for the firm?
What is the nature of the debt?
Hi Michael,
Thanks for the reply, his name is Jed when I looked at the employee directory I found Jed Sternberg so I assume that’s him.
I co-signed on an apartment lease 5 years ago. It’s a debt to a property management company in California. I’ve considered trying to make a deal with the management company directly, but since they hired an attorney to collect and the account is now closed. I’m not so sure it would satisfy the judgement against me anyway.
You can negotiate the lump sum payment as conditional for updating the court that the judgment is satisfied.
How close are you to any of the firms physical offices?
I’m in Oregon, all of the offices are back in California. It’s bizarre to me that the firm wont put any of the verbal agreement in writing even if I agreed to pay it in full right away.
This isn’t some kind of collections practice violation?
No, the refusal to reduce an agreement to writing is probably not a violation.
I will send you an email with contact details to a couple of really good consumer law attorneys in Oregon. Both likely offer an initial consult at no charge, and if they can help you, charge fair fees to get this over the goal line.
Thank you Michael, I really appreciate your help and advice on this!
Hi Michael, I’ve recently been served with a lawsuit from the attorneys at Midland Funding on 3-26-2015. With this amazing website, I was able to negotiate a settlement of 1900 vs. original balance of 2600 prior to any court appearances. As per your advice on agreements, I asked for them to send me a settlement letter and they agreed. I’ve made my payment, however, I am concerned as to whether they will dismiss the case in time before my 30 days are up. The account manager on the phone told me it can take up to 45 days. Would you advise that I still send an answer to the court? I do not want a default judgment against me. Thank you so much for your help, this forum has helped me learn so much!
If you have everything in writing, paid on time, and have proof of that, filing an answer may not be necessary. It can take time for the attorney to get the dismissal in. 45 days is not unreasonable.
Does the agreement with Midland or the attorney speak plainly to the dismissal? If so, you will be okay. If there is some error, you will be able to get it corrected quickly.
Thanks for posting, and for your kind words too. Please post an update to this string when everything is updated with the courts, credit reports, etc.