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Settlement... as "final payment" Really??


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Hi

Last week I received a settlement offer from attorney as follows:

COMMENTS PLEASE.......

"The current balance due is 16,000. In an effort to settle this matter and LIMIT further collection actions our client has authorized our firm to extend a settlement offer to you.

... our client Blubber Bank will accept a lump sum of 4,000.00 as a SETTLEMENT AND FINAL PAYMENT of your current obligation."

Will this language prevent all further actions or can they sell the balance (12,000.00) and have another company start dunning me.

Thanks.....

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I have little experience in actually executing a settlement so take this for what it's worth: ::tp::

While settling for around 33% is nice, I'd wonder if there is any additional wiggle room. (EDIT: Yeah so it's 25% of the alleged balance due and not 33 and a third. :oops: DUH! I later noticed I misread the 12,000 balance part. I missed the part where said it was 16,000. I CAN do basic math..I promise :lol:)

Before I forked over 4 grand I would want to make SURE I have some very specific lingo worked up to protect me against any future issues. I'd also be a little more likely to pay an attorney a few hundred bucks to look over or draft a settlement agreement. I would definitely want to make sure I limited their ability to sell or otherwise transfer it to someone else.

You could always try telling them you are interested in the settlement offer and have them fax/mail you a settlement agreement. That would give you a starting point to make revisions to or take to an attorney. Of course their first draft would be most beneficial to them.

Edited by SingleDadJames
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Hi

Last week I received a settlement offer from attorney as follows:

COMMENTS PLEASE.......

"The current balance due is 16,000. In an effort to settle this matter and LIMIT further collection actions our client has authorized our firm to extend a settlement offer to you.

... our client Blubber Bank will accept a lump sum of 4,000.00 as a SETTLEMENT AND FINAL PAYMENT of your current obligation."

Will this language prevent all further actions or can they sell the balance (12,000.00) and have another company start dunning me.

Thanks.....

A couple of things to consider, 25% settlement is a darn good opening offer as long as it comes with a reasonable settlement agreement that includes, no assignment or sale of balance. I would also ask for a Non-Disclouse Agreement, this would give you the upper hand on reporting to the CR's regarding the debt. If they aren't able to disclose they are able to report or verfiy accuracy and you may get the tradeline removed in future.

This is prime settlement time as they know folks are getting tax money back. Finally 25% is pretty deep even for OC's, so the CA may own the debt, which if you don't reach agreement and you do have to litigate can be to your favor.

Good Luck

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Thank you, and YES it is a good offer. I am not at all concerned about my credit rating; and, while the settlement offer is very good, my concern is having the remaining (forgiven) debt sold for future collections.

This site offers, IMO, an excellent settlement letter as follows in part"

"The acceptance of the payment will serve as a complete discharge of all monies due, and the COLLECTION AGENCY agrees to consider the debt paid in full and agrees to not take further action which includes, but is not limited to, selling, transferring, or disclosing information to collect on the forgiven balance. The payment shall be made in the form of a cashier's check or money order."

I AM JUST WONDERING IF SUCH A LETTER IS NECESSARY or IF THE ONE THE ATTORNEY SENT (above) IS SUFFICIENT. +++I don't like the word "LIMIT" in their letter.

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