Settling a debt that has gone to collections
By maezee
@maezee (41985)
United States
February 2, 2012 3:06pm CST
Hi! I am excited as I start this discussion because I have the $1,000 out of the $1,300 I owe to the university I attended for one year (and couldn't afford to continue) - a debt that I've struggled down from $4,000 to $1,300 over the past year or so of being on a payment plan.
Tax time for me has come and gone, and I am considering trying to hanagle my collector into 'settling' my debt for $1,000 by chopping off the $300 and some dollar late penalty fees they put on there.
I am just curious to know how to even go about doing this. What do I even say? And do you think they will go for it? My friends and fam have been saying that "the worst they can say is NO", which I suppose is true. I've never had anything in collections before so this is utterly new to me. I just want to settle it so I can move on with my life!!!! They have been trying to get tihs money out of me since the 2008-2009 school year that I went there (a LONG time ago!) so I'm hoping they will take the bait!
ANY Help if you've ever been in a similar situation would be extremely helpful.... What to say, what you think they will say (yes or no?) and anything else I should know before hand... Otherwise, wish me luck guys!
3 people like this
12 responses
@SpikeTheLobster (6399)
•
2 Feb 12
So you've got a debt of $4k that you've worked down to $1,300 and want to pay the last bit off in one go? Heck, yes. Write to them.
Just about ANY creditor with any sense will give you a big discount to recoup the entire debt in one shot. The alternative is waiting months and months for the money. I've had people offer 40% discounts before, just to get me off their books (it looks really good on their balance sheets and stuff).
Send them a letter. Explain that you could continue paying them their $50 a month or whatever for the next two years or, if they'll accept a settlement, you can pay them $1,000 now. Make it VERY clear that they MUST write off the rest of the debt and contact all the usual credit checking agencies to re-establish your "clean" rating as part of the deal and that, if you pay the $1k, that's it - the slate is clean.
You have a VERY good chance of it being accepted and, if not, you can always just pay off $50 a month or whatever as usual. And while you're doing that, you could invest the $1,000 to earn a little interest to help pay off the extra $300.
@peavey (16936)
• United States
2 Feb 12
First, tell them that you have the thousand dollars for them, then tell them that although it's been very difficult, you've been working at paying this debt off for quite some time and you're very pleased that you're within $300 of doing so. Then ask if there is any way they could forgive the last $300.
As has been said, the worst they can say is "no," but they could say "yes." I think the chances of them saying yes is good, but you won't know until you ask.
@SpikeTheLobster (6399)
•
2 Feb 12
Asking nicely won't get you anywhere with creditors: they'll see that as weakness and say "No". Trust me on that one. I've had to beat my ex-bank into submission to get them to start settling. 
@lovinangelsinstead21 (36847)
• Pamplona, Spain
22 Feb 12
Hiya mae,
You have done well to get that down to that amount. Personally I can´t give you any real good advice as your Laws are different to ours.
Students here that owe money are really hard done to as well they have to take out loans well now they can´t even get any they have to rely mainly on Family to get them to University.
But if you can manage it so they give you help of some kind monetary wise well even better good luck then.xxx
@randylovesdar (4932)
• United States
4 Feb 12
I would go for it and ask if they would be willing to take the $1000.00 and consider it settled. Just be sure to have them put it in writing that you want them to contact the credit bureaus and have them say settled paid in full and then hand them over the money. I think if you show them you have the $1000 and how hard you worked to earn this money they will more than likely forgive the extra 300 you own. I wish you the best and congrats on being able to pay off a debt.
@ReViewMeMedia (3786)
• United States
2 Feb 12
If you're earning money online, just save it all up until you have the $300 then pay the university and not through the collection agency.
@ayumitakashi (4462)
• United States
3 Feb 12
I'm actually about to start paying off my student debts in a few weeks so I am kind of scared. It does feel good when you have finally paid off all your debts or are at least paying them off little by little. I agree with what your family said to you, just call and the worst that they can say is no. I've paid off credit cards before and they've always given me a settlement so that has made it easier. But go ahead and call and hopefully they will give you a settlement so that it makes it easier for you. Good luck and all the best.
@SomeCowgirl (32189)
• United States
2 Feb 12
From what I've understood with having settled my own debt it most of the time they will work with you and do that. They want money, that's their bottom line and if your stern enough it may work. If you say you can immeadiately send it off and have it over with that may win them over even more. Good Luck To You.
I did a payment plan, but they settled for less then I owed.
@bounce58 (17380)
• Canada
4 Feb 12
I don't have any experiences with this, but I think you should go and at least try. Like what your friends and family said, the worst they could say is NO.
But if the collector would agree, then it would really be great. That freedom would feel so sweet! And moving on with your life would be even sweeter!
Goodluck!
@kingparker (9673)
• United States
3 Feb 12
I think you should go for it without hesitation. Like your family and friends told you, the worst scenario they will reject your offer, big deal. Anyway, they probably would accept your offer in such case. You told them your current situation, that you are unable to pay all of it, instead, you can settle it down on $1,000, take it or leave it, simple enough. Good luck!
@FrugalMommy (1438)
• United States
3 Feb 12
My uncle has worked for collection agencies for decades, and his suggestion to one of my cousins at Christmas time was to have the cousin's mom call the collection agency and offer them a settlement. He said to offer them about 40% of the total balance still owed, and he said he was pretty certain that they would jump at the opportunity to get the account settled.
The reason he told my cousin to have his mom call the collection agency is because they legally can't tell her anything about the account. They can't harass her about the debt because she didn't sign for it.
Incidentally, the collector did accept the amount they were offered on the account. My aunt made sure to get the arrangements in writing saying that the debt would be satisfied and it wouldn't be reported on my cousin's credit report before she made the payment.
@WakeUpKitty (8691)
• Netherlands
2 Feb 12
First of all: congratulations you came that far!
Secondly: give it a try! I think there is a big chance they will go for it if you show them you are serious about it and worked hard to get the money.
So go sell yourself, wish you all the luck.
