Okay, so first off, I know they're just doing their job. Second, I know I got myself into this mess.

I lost my job last year (I'm sure some of you remember). Well, a card I totally forgot about just hit collections. As far as my understanding of the system goes, once an account is charged off, it doesn't really matter what happens, so long as it gets paid, so this is my story.

It was a small credit card ($500). It showed up on my report a few weeks ago (rather, I decided to subscribe and try to fix everything that was messed up). The account showed a balance of $742.00. I called them today, and here's the down and dirty of the conversation.

J = Jeremy (Me)
M = Mohammed (the collections dude)

M: Hi, and thanks for calling. This is an attempt to collect a debt (Yadda yadda).
J: Hi, I want to pay my account off, but I need a settlement.
M: Ok, SSN?
J: 123-45-6789
M: Thanks. You owe $742. How would you like to pay that?
J: With as few bills as possible. Can you accept a settlement?
M: (After some research) I can accept $0.75 on the dollar. That's a payment of $556. This is a one time offer and I can only do it today.
J: I can't afford that. I just received a rebate debit card for $300 (lie, kind of. I could pay the whole amount, but at this point, it's not going to help or hurt me to settle).
M: We can't do that. $400 is the lowest we can go. (piques my interest)
J: Okay, look. The card is really for $350, but I was hoping to get a tank of gas and lunch out of it. If you can do $350, I'll do it.
M: There's a $8.00 processing fee
J: Then I can do $342.
M: Done
J: Done


I've heard of a lot of people getting better discounts, I think I ended up doing pretty well. It was under $0.50 on the dollar. I have another account with a greater dollar amount, that I'll try to get a better discount on. Just letting you all know that it *is* possible to "talk 'em down". That, and I'm a little proud of myself. I've never been obstinate or boisterous with people on the phone (the most rude I get is to hang up on them).

Thoughts? Personal stories? Recommendations? As soon as I get this mess cleaned up, my goal is to keep myself debt free (maintaining a credit card for emergencies until I can build up a healthy savings account), with the only debt I eventually incur is a mortgage.

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I've heard that you can talk them down big time, I personally haven't though.

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Check out Fast Super Cars, Car Tuning, and WNY Sports

Twitter - @Ryan911T - @MotoExposure

Well, I got half off. That's not bad.

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well done

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Proud LGBTQQ Individual

It depends what 'level' of debt collectors they are.

Once a debt it written off by the original company, it gets offered up for sale to collection agencies. They'll buy it for, say, $0.90 on the dollar. That agency will then try to collect on it. If they can't collect, they'll sell it again for $0.75 on the dollar. This process continues if the debt doesn't get paid off. The longer it goes, the less money actually gets paid for it, and the less reputable the collectors become.

Once agencies start paying $0.25 on the dollar, and often less, they're called JDBs; junk debt buyers. This is debt that is has been outstanding for a while, and many agencies have tried (and failed) to collect it. It's considered junk because there's almost no chance it will be paid off.

These lowest tier agencies will lie, cheat, and harass to no end to get that money. However, on the upside , they're not that invested and will take a lesser payment because almost anything they get is pure profit. They'll try to get more obviously, because the more they get the more commission that guy on the phone gets.

Some advice from my past experience in credit troubles. (My ex put me $10k+ in debt about 8 years ago, and I went through all this trying ti dig out.)

1. Know your rights. Read up on the Fair Debt Collections Practices Act, FDCPA. Know what can and can not be done. If debt collectors break these rules, and they will often, you can file suits against them for $1000 a pop. I'm not advocating trying to profit off them as some do, but it's a nice bullet to have in the chamber when a particularly skeezy one comes after you. They're holding you to the rules of your contract when you incurred the debt; hold them to the rules of collecting it.

2. Get everything in writing. There are plenty of people out there that will say anything on the phone to get you to pay, and won't care about it afterwards.

3. Try to negotiate getting your credit reports cleaned off as part of the settlement, if you go that route. It can be difficult to get something bad off after the fact. If you can get it done up front, you'll be better off.

4. Know your rights. Can't stress it enough.