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Proceeding with collection agency


onlyoneleft
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The story goes...

I had a sizable consolidation loan with Capital One that ended up being charged off about half way through the length of the loan, after I could not make the minimum monthly payments and the fact that they would not work with me on modifying the loan in any form so I could pay them. It was sold to Atlantic Credit & Finance. It has been about 1 year 4-5 months since the charge off. I never contacted the collection agency during that time, as I was spending all of my money on clearing up some other debts with a DMP. Thankfully those other debts are now in my past!

It looks like the debt was sold to a local debt collection "law" office, or they were assigned the debt, with Atlantic as their client. Since they are local, and have ability to reach me through legal civil means if necessary, and this is my only remaining debt to clear up, I want to start proceeding to get this debt settled/paid off. I know the debt is valid, but want to proceed cautiously with the collector.

I am considering sending them an agreement for settling the debt, offering 25% of the total debt. I had turned off my home phone, and only use an unlisted cell now, so they only have my home address, and I would like to keep them with having as little personal info as they already know or could find on their own. That is why I am thinking of mailing (certified with receipt) the agreement. I am lucky enough to have enough cash to settle for up to about 35% of the total, otherwise I would be looking at making payments to them for several years. I am hoping to avoid that scenario, shorten my contact with them, and get rid of this last debt as quickly as possible. I do have a sample debt reduction agreement that includes wording around removing negative credit marks, etc.

So, I guess my question is, does this seem like a plan that could work, in terms of hoping to work out a settlement and limiting phone contact with the collector? Should I send just the offer, or include a quick letter, stating that I would like to settle this debt? I am thinking that they would rather get 25-30 cents on the dollar (given that they probably paid well less than 10 cents on the dollar) immediately, than have me make monthly payments for several years.

Thoughts? And thanks!

Edited by onlyoneleft
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The story goes...

I had a sizable consolidation loan with Capital One that ended up being charged off about half way through the length of the loan, after I could not make the minimum monthly payments and the fact that they would not work with me on modifying the loan in any form so I could pay them. It was sold to Atlantic Credit & Finance. It has been about 1 year 4-5 months since the charge off. I never contacted the collection agency during that time, as I was spending all of my money on clearing up some other debts with a DMP. Thankfully those other debts are now in my past!

It looks like the debt was sold to a local debt collection "law" office, or they were assigned the debt, with Atlantic as their client. Since they are local, and have ability to reach me through legal civil means if necessary, and this is my only remaining debt to clear up, I want to start proceeding to get this debt settled/paid off. I know the debt is valid, but want to proceed cautiously with the collector.

I am considering sending them an agreement for settling the debt, offering 25% of the total debt. I had turned off my home phone, and only use an unlisted cell now, so they only have my home address, and I would like to keep them with having as little personal info as they already know or could find on their own. That is why I am thinking of mailing (certified with receipt) the agreement. I am lucky enough to have enough cash to settle for up to about 35% of the total, otherwise I would be looking at making payments to them for several years. I am hoping to avoid that scenario, shorten my contact with them, and get rid of this last debt as quickly as possible. I do have a sample debt reduction agreement that includes wording around removing negative credit marks, etc.

So, I guess my question is, does this seem like a plan that could work, in terms of hoping to work out a settlement and limiting phone contact with the collector? Should I send just the offer, or include a quick letter, stating that I would like to settle this debt? I am thinking that they would rather get 25-30 cents on the dollar (given that they probably paid well less than 10 cents on the dollar) immediately, than have me make monthly payments for several years.

Thoughts? And thanks!

My question would be, if you settle with this Junk Debt Collector for what ever amount. What will keep him from selling the remainder of the unpaid debt to another JDC and having to re-live the problem all over again?

**

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That is why you get the agreement in writing, attach a copy of the payment receipt (copy of the canceled check, copy of the money order receipt, etc) to the agreement,and then store it in a place where it can be retrieved quickly by yourself for the rest of your life and by the executor of your estate after you pass away.

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Yes, that is exactly my plan. Be sure that the settlement agreement letter has wording in it that states they will not come after me for the remainder, and that the agreement is for payment in full. I was able to find a decent sample letter for settlement offer online, tweaked it for my situation, and sent it off to them, certified with return receipt for my records.

I am handling this negotiation via mail, so I will have everything documented, and will also not have to deal with any rude, pushy collectors over the phone.

I had initially offered about 25% for the settlement, and received a letter from them today, looking for 60%. It also included some wording about having a certain time frame to present the payment, otherwise they would be entitled to the full amount. That could just be a scare tactic, but I am hoping to get some settlement agreement put together in the near future anyway.

So, now I am going to submit a counter offer, but not sure on the exact approach, and want to be careful, so I can get a settlement that I can actually afford.

Based on cash I can cobble together, I can probably go no higher than 35-40%. I am just not sure if I should present a counter offer in my high end range, and state in a cover letter that this is as high as I can offer, otherwise we will be looking at several years of small monthly payments. I suppose another approach would be to see if an agreement amount could be paid over the course of 5-6 months?

Any thoughts on approaching the counter offer?

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  • 2 weeks later...

Update...

I countered at about 35%, and just received another counter from them for 50%. So, the good news is that it looks like they are willing to try and work with me. I am going to counter again, and hopefully will get them to come down again, settling somewhere in the 40-45% range before agreement and sending the payment.

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