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 I know this has probably been asked thousands, and if you have a thread you want to direct me to feel free.

So, I have a fortunate situation in which a generous relative is offering to help me pay off my bad debt so that I can start the process of  rebuilding my credit score but I am not sure how to begin this process.

To cut to the chase I have about $16,000 in written off debt that is with third party collection agencies. $10,000 of  this is from pay day loans, yes I know how bad these are, $5500 is from credit card debt and about $500 is from past medical bills  that I completely forgot about. Most of the debt on my credit report looks legit

Since these collections agencies seem to pride themselves on scare tactics, and deception, I am wondering how best to approach  them and how much I should realistically be offering to pay given that the damage to my credit is already severe and knowing that most of these companies probably paid pennies on the dollar for these debts. The Pay Day Loans have gone third party within the past six months so they are very "fresh" but the credit card, and medical debts, are 3-5 years old but, none the less, are still getting reported.

Funds are not unlimited, and I am realist in terms of my credit score, but, at a minimum, I would like to stop the harassment and stop these debts from continuing to be reported. I  am not disputing the debts but, on the other hand, I don't want my relative to  shell out $16,000 when I could have settled this debt for  fraction of this and gotten the same outcome in terms of my credit score.

Any advice will be greatly appreciated. Thanks!


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  • 2 months later...


First of all, make sure these debts are valid. Don't let the collection agencies bully you.

Considering your circumstances, I would advise you to call the lenders and collection agencies and try to negotiate your debt down. Have a good story for why you haven't been paying your debt down. If you come across as someone who is struggling to meet the minimum monthly payments and are desperate for a solution, they are more inclined to help you out. Ask them if you borrowed money from a relative, could they reduce the lump sum. Sometimes they will reduce the amount accumulated through interest. 

Credit card companies usually have a hardship program that will freeze the card, preventing future interest to compound. They will put you on a payment plan to pay off the debt, but ask them if it could be less if you paid it off all at once. Lenders and collection agencies prefer this, especially if you are behind on your payments. 

Medical debt can be removed through credit repair, depending on your situation.

You're definitely on the right track!

I hope this helps,



Trustfund Group

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