Smart ways to negotiate with credit card debt collection agency

Last Updated : Feb. 29, 2020, 2:43 p.m.

If your credit card debt is due from a longer period and you have not made any payment against your outstanding debt in that case the credit card company can send your credit card account to third party to collect the funds. If you are a credit card payment defaulter, in that case credit card companies use various ways to get their money back and among those options one option is transferring your account to third party. This changes the situation a bit as the credit card company is no longer involved. Now, your credit card company will no longer attend your calls or involve in any kind of communication.

Now, it is the collection agency, which will contact with you. The debt collection agency has all the rights to collect the money for the respective bank or credit card company as it is being hired by them. These collection companies involve different ways to get the recovery of the amount. These collection companies are legally entitle to collect the debt from the defaulter. They also want to collect the entire/maximum amount on behalf of the bank or credit card company, but, at times, they agreed to accept the lesser amount to settle the debt for the original creditor. Generally, these collection companies get the instruction to collect the whole amount, but if it is not possible so, they settled to a lesser amount close to 60% or 70% of the total amount owed by the defaulter. So, in such situation where the collection agency got the instruction to collect the debt from you at any cost or settle the debt at least with a decent amount. So, it gives you a good scope to negotiate well with the collection agency. When you are negotiating with the collection agency here are some important points which you should keep in mind.

First fix a meeting with the collection agency: This is first and foremost step towards your debt collection. Ask the collection agency to fix the meeting for discussion. Face-to-face meeting is very important for better negotiation. Try to fix the meeting on urgent basis. It is good option to discuss every thing face-to-face as it will help you to make them understand your situation better.

Discuss your financial condition: It is important that you discuss your financial situation well to the collection agency’s representative. Discuss your financial cycle or if there is any medical or family problem you are facing and due to that you are unable to make the payment. Try to elaborate your point in detail to convince them that your reason of default is genuine.

Negotiate well with collection agency: When you got the call from the collection agency regarding the collection of credit card debt the first thing you should ask from them is how much your outstanding amount. Fix a meeting with the collection agency and try to negotiate as much as you can to pay the minimum amount as settlement.

How much you are going to pay and what it’s for? While paying any amount you should ask this from the collector that is the amount going against the principal amount or is the amount will be counted as settlement amount. When you agree to pay a certain amount to the agency, make sure that the agreement you get in writing includes what the payment is for. Under which title that payment will be deposited.

Try to get a debt statement: While making any payment to the debt collection agency always ask the agency the payment to credit in which debt account. Always ask for a statement from the collection agency stating that this collection is for so and so title. The name of the original creditor and account number should be mentioned on the letter. If they can’t able to provide you details about the account and all try to at least get this in written that the collection is for which account specifically.

Ask about the due date: Sometimes these collection companies offer you a set deadline to deposit the amount. In most of the cases, these companies offer you a deadline of 15 days to 30 days maximum. If you know that you are not able to arrange to funds in the given time frame ask the agency to extend the date so that you will arrange the funds and make the payment within the given time frame. If in case, you fail to make the payment on time, the offer they have made may be voided, means that all your negotiation will goes in to waste. Be sure to get a copy of the deadline in writing to ensure you have proof you paid on time.

Whom you are going to pay off: At the time of settling your debt ask your agency representative that this debt is going to be adjusted against which company either credit card company or to the agency. So, make sure that you are going to pay against the right company, so ensure that your payment is going in right account.

Get your credit report rectified: Once you settle the credit card debt just ensure that you are going to get your credit report rectified. You should ask the credit card company to rectify the comments mentioned by the agency as defaulter get it modified and ask them to remove the negative remarks from your account. This will help in improving your credit card report.