Can You Negotiate Debt?

Calculator application on mobile phone screen on white surface near crop anonymous person holding pile of dollars

Can you negotiate a debt? This question is relevant to many people who owe too much to comfortably pay back. Fortunately, one of the major truths in business is everything is negotiable. It is possible to negotiate your debt if you feel like it would be daunting for you to settle it. 

What Are the Basics of Debt Settlement?

If you’re looking for an effective credit card relief program, debt settlement is a form debt relief that involves negotiating with creditors to reduce the amount you owe by a significant amount. 

The Best Way to negotiate a settlement with a debt collector

  • It is very important to learn about the debt and plan for a realistic proposal before negotiating your debt. The three steps explained below can prepare you to negotiate a settlement or repayment agreement with a debt collector. 
  • Learn about the debt

If a debt collector contacts you to collect a debt, it is important that they give you certain information. This includes the name of the creditor and the amount you owe. This information must be provided on initial contact or in writing within five days of the contact. You have the right to dispute the debt or ask for the name or address of the original creditor if the information presented does not add up. If you present the dispute in writing within 30 days of getting the validation notice, the debt collection agency is not allowed to contact you until they give you a verification of the debt in writing.

  • Make a plan for a realistic repayment or settlement proposal.

To get debt relief you need to have a realistic plan. First thing here is to be honest with yourself concerning the amount you can afford to pay every month. It is necessary that you first review your debt priorities since you are likely to get into more problems if you fall behind on other bills just because you are trying to settle your debts.

It is also important to put into consideration your monthly pay and all of your monthly expenses; the expenses should include the amount you want to repay at the end of every month. After doing that, you should put aside some money for unexpected expenses and emergencies, just to make sure you don’t land in more debts. You may seek the services of a credit counselor if you cannot do all that on your own.

After doing the calculations, you can decide on the particular amount that you want to pay. You should not pay more than you can afford. You’ll find additional useful advice on this topic at https://www.bills.com.

  • Use your proposed repayment plan to negotiate with debt collectors

The first step when negotiating a debt is to lay out your plan. You should explain your financial situation to the debt collector. There is more room in negotiating with a debt collector that in negotiating with the original creditor.

The next step is to record your agreement after one is reached. Sometimes there are misunderstandings between consumers and debt collectors’ days after an agreement is reached. Therefore, it is advisable that after reaching an agreement to a repayment or settlement plan; you record the plan and the promises made by the debt collector.

You should be aware of agencies that charge you money in advance to pay debts for you. Dealing with debt settlement agencies can sometimes expose you to risks. This is because some of the agencies make more promises than they deliver. Some creditors may also decline the revised terms. You should work with agencies approved by your creditor.

Can you negotiate a debt? Yes, but you have to learn about the debt and plan a realistic repayment proposal.

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