How to Negotiate with Debt Collectors?

The pressure of not being able to pay your bills can be overwhelming.

If you're in debt and can't afford to pay off your balance, you may be able to negotiate a more affordable payment with the debt collector if you have an account in collection status.

A good way to resolve the situation is by negotiating with your collector and discussing how you can pay them off in installments.

If you're struggling to make your monthly payment on time, knowing how to negotiate with debt collectors will help get a solution that works for both parties.

Here are the steps to successfully negotiate with Debt Collectors:

1.      Verify That It's Your Debt

You should investigate the credibility of creditors' claims by asking them for their name, company phone number, and business address. If your state licenses debt collectors, check to see whether the company is listed.

The collector should send a validation letter within five days of contacting you stating the debt amount, creditor, and what to do if there's an error. You have 30 days after receiving the first written notice from them to send a verification letter asking for additional information about the debt.

2.      Know Your Rights

Make sure you're aware and informed about your rights before speaking with the Debt Collector - otherwise an experienced collector could easily take advantage of you.

Here are the things you should know:

• They can't use disrespectful language when speaking to you

• Debt collectors can only call you between 8 a.m. and 9 p.m.

• Debt collectors should only contact your employer, family members, and friends to find information about you

• They can't threaten you with something that's illegal or they won’t follow through on

3. Understand How Debt Collectors Work

The best way to avoid collections calls and letters is by paying your debts. Once you make a payment, you'll stop getting collection calls, improve your credit score in the long run, and also protects yourself from being sued.

4.     Figure Out What You Can Afford to Pay

When deciding whether or not to pay off a debt, consider your financial obligations first. Take an honest look at how much money you have budgeted for this year's expenses and income so that no other bills will be left unpaid.

Debt collectors will want to collect as much of your debt in a single payment, but it's important not to do this. Instead, consider paying your debt slowly over time with smaller installments.

5.      Know How Your Payment Will Affect You

The key to a successful credit recovery plan is awareness. You should know the consequences of your offer. Your payment will be reported to credit bureaus if it's still within seven years of the credit reporting time limit for most debts; paying in full typically looks better than settling your debt, but making a payment is better than non-payment.

6. Speak calmly and logically

You should enter the conversation as calmly and knowledgeably as possible with an understanding of your rights as a debtor and what creates illegal behavior from the collector.

Ask for verification and sniff out any fraudsters, determine if it is yours or not before deciding on repayment strategy.