DebtClear

Roadmap Roadmap

Debt Settlement Tutorial

To Review

  1. Never admit to the debt. I can't stress that enough; that's why I keep saying it.
  2. Stay calm. Original creditors and debt collectors can certainly get abusive, but they have no real power over you. If you can't stand it, hang up. That's your right. (But if they do get abusive, document what happened during the call!)
  3. Negotiate at the end of the month. Debt collectors and settlement attorneys are often like salespeople with quotas to meet. If they need the "numbers" to make their month, they may be more willing to negotiate.
  4. Offer a lump sum to settle. Offering to enter a payment plan is fine, but the debt collector would greatly prefer a lump sum payment. Debt collectors want the money now. "Later" may never come.
  5. Realize that the "supervisor" you get transferred to is probably the person in the next cubicle. That's just a sales tactic; don't buy it.
  6. Never give out bank information, agree to automatic deductions, or make a payment by wire transfer or "check by phone." Once you give out personal information you can never, ever get it back.
  7. Get a copy of the agreement in writing. Never make any payments until you have the agreement in writing, and are positive you understand and accept the terms of the agreement.

Think long and hard if you are offered a settlement. Think about your willingness to accept the risk of a lawsuit. Think about the likelihood of even lower settlement offers down the road. Think about the effect a settlement will likely have on your taxes.

Only you can decide what's right for you, so make the best choice for your situation. And, if you don't reach an agreement you are comfortable with—or one you can afford—keep playing the debt relief game by your rules. After all, now you have the playbook.

> In Closing