Have you received a letter from a collection company? Debt collectors are very persistent and quick to sue when it comes to late repayments. Unpaid debt is really bad for your credit score and most people find the constant back and forth with debt collectors to be very stressful. However, it is within your interests to settle with them as quickly as possible and you should always look to negotiate the best possible outcome. This is the first reason why most people turn to debt relief lawyers and rely on the experts to get back on track.
But how might you negotiate with a collection company?
Let’s take a closer look at the role of a collection company and how you can negotiate a better arrangement and solution for your outstanding debt.
What is the Role of a Collection Company?
A collection company works to recover unpaid balances for loans. While lenders sometimes have in-house teams to manage debt collection, they will often use this third-party to recover the bad debt. The end goal for a collection company is to make contact with you and try to recover the amount past-due.
With this in mind, collection companies can take you to court and request to take money from your bank account or wages. There are laws (Fair Debt Collection Practices Act) to protect unfair practices but you should know that collection agencies are very persistent and aggressive with their approach. Now, this is not to scare you but rather to prepare you for the fact that you need to take swift action and not simply ignore them when they come knocking.
It’s very important to respond right away in the event of being sued by a debt collector. You can do this yourself but hiring debt settlement lawyers will take much of the stress and guesswork out of the process. Lawyers also know everything about debt collection and how to negotiate the best outcomes.
Can You Negotiate with a Collection Company?
Yes, you can negotiate with a collection company. Debt relief lawyers will often negotiate affordable repayment plans and even lower amounts to be paid than you initially owed. That is to say, you can sometimes arrange a plan with lower monthly repayments that will eventually add up to the full balance owed. It’s also possible to negotiate a lower balance because collection agencies are sometimes willing to accept partial payment to avoid a prolonged process.
If you do manage to come to such an arrangement with a collection company, the debt is reported as “paid in full” and this will have much less impact on your credit score. However, debt collectors are still likely to push for the full balance and this is why the negotiation skills of debt settlement lawyers are most beneficial.
And how else might debt relief lawyers help you?
Debt relief lawyers will often dispute your debt or at least part of the debt. They become your point of contact for the collection agency which means you won’t have to go back and forth with them yourself. If you have poor credit, a debt relief lawyer might point you in the direction of debt settlement. This may be the best option and debt settlement lawyers have the necessary skills, experience and knowledge to help navigate this process.
Debt settlement lawyers specialize in negotiating with collection companies. They can help reduce the balance of your debt, know everything there is to know about the process and can suggest the best way forward based on your circumstances. It’s also important to take action now as late repayments stay on your credit report for 7 years and affect your ability to apply for future loans.
In the end, the goal for debt settlement lawyers is to come to a realistic settlement plan for your balance due and do everything possible to protect your credit score. You can always try to negotiate with creditors yourself but expert knowledge and experience will help you achieve a far better outcome. You can also avoid dealing directly with debt collectors and take peace of mind from how a debt relief lawyer is always fully focused on your best interests.
Get in touch with one of our team at McCarthy Law today and we can start discussing how to negotiate a desired outcome for your loan outstanding.