glasscrump

Settling with JDB vs. Law firm?

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Can anybody shed light on whether it is better to try to settle with a JDB vs. a law firm? Does a law firm usually demand higher or vice versa? If it is not certain that a law firm may sue, and I don't have a lot of disposable money, isn't it better to save up a bit per month and wait until I hear from a law firm instead of trying to settle with a JDB that may not like my low monthly payment plan? That way, by the time a law firm might contact me to threaten lawsuit, I would have more saved up which might allow me to negotiate down the total amount to pay if I can offer more up front.

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I really think you're splitting hairs on top of trying to do the equivalent of predict red or black on a roulette wheel.  One thing that makes me think that JDB would be more amenable to a lower settlement is the likelihood that the JDB incurs additional costs when they turn the debt over to a law firm.  But then there are a dozen other factoring variables for each individual debt (e.g. amount, age, number of previous owners, how long they've had it) that none of us can account for.

You have a window of opportunity now that will evaporate when they turn the debt over to a lawyer, so I would contact them and offer 1/2 of what you can afford (but no more than 25% of the debt they claim you owe).  If that dead-ends, then you can wait for the thing to be turned over to a lawyer and try again.

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If the law firm is working under a bulk contract with the debt buyer, the cost is already baked into the equation so there shouldn't be a big difference. I did something similar - rather than reaching out to them, I worked on saving money and securing credit that could be used in the event they sued.

You are in CA - members of this forum from CA are very helpful in using CA statutes in your favor, if they do sue. I'd just wait to see what happens.

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