Settling with JDB vs. Law firm?

Recommended Posts

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.

Link to post
Share on other sites

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.

Link to post
Share on other sites

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.

Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.

Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.