First, if you aren't sure who the proper owner of the debt is, you will want to pull your credit reports from all three credit bureaus and double-check the information contained within. You need to know whether the debt is still with the original creditor or if it's been assigned or sold to a collection agency. Do not attempt to make any contact until you've verified who you actually owe the money to.
2Next, you will need to decide beforehand how much your initial settlement offer will be and what the repayment terms are. You can choose to offer any percentage of the debt, either in payments or in one-lump sum but be aware that creditors will most likely reject your first offer. Be prepared with a counteroffer in case this occurs.
3Basic information you will want to include in your letter are your name, address, and other contact information. You will want to address the letter to your creditor along with their contact information and including a message line referencing your account number. You may also want to include a brief outline of your financial situation and supporting documentation.
4Next, you will want to detail specifically how much the settlement offer is for, how it will be paid, and what remaining debt balance is to be forgiven. Again, if you've already negotiated this beforehand you may want to reference the customer service rep you spoke with and the date of said conversation. You may choose to or be obligated to also a include a statement saying that if you default on the terms of the settlement, the creditor may be free to pursue further collection efforts against you.
5Next, you will want to include a statement pertaining to how the debt will be reported to the three major credit bureaus. The creditor may choose to report the account as paid in full or settled or may not choose to remove any negative entry at all. You want to be able to negotiate the best rating for your credit possible and have a written record that the creditor has agreed to your terms.
6Once your proposal is accepted in writing by the creditor, you will want to include either a money order or certified check for your payment. Do not send a personal check. On the memo line, write "Cashing this check constitutes payment in full". You will want to make copies of your letter and your check to keep on file. The creditor's copy should be sent via registered mail with return receipt.
7If your initial offer is rejected, draft a counteroffer letter outlining in detail why you are unable to pay the amount they are requesting. Restate what it is you can and are willing to pay and how and resend the letter via certified mail, again requesting that they send signed confirmation if they agree to your terms.
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2Next, you will need to decide beforehand how much your initial settlement offer will be and what the repayment terms are. You can choose to offer any percentage of the debt, either in payments or in one-lump sum but be aware that creditors will most likely reject your first offer. Be prepared with a counteroffer in case this occurs.
3Basic information you will want to include in your letter are your name, address, and other contact information. You will want to address the letter to your creditor along with their contact information and including a message line referencing your account number. You may also want to include a brief outline of your financial situation and supporting documentation.
4Next, you will want to detail specifically how much the settlement offer is for, how it will be paid, and what remaining debt balance is to be forgiven. Again, if you've already negotiated this beforehand you may want to reference the customer service rep you spoke with and the date of said conversation. You may choose to or be obligated to also a include a statement saying that if you default on the terms of the settlement, the creditor may be free to pursue further collection efforts against you.
5Next, you will want to include a statement pertaining to how the debt will be reported to the three major credit bureaus. The creditor may choose to report the account as paid in full or settled or may not choose to remove any negative entry at all. You want to be able to negotiate the best rating for your credit possible and have a written record that the creditor has agreed to your terms.
6Once your proposal is accepted in writing by the creditor, you will want to include either a money order or certified check for your payment. Do not send a personal check. On the memo line, write "Cashing this check constitutes payment in full". You will want to make copies of your letter and your check to keep on file. The creditor's copy should be sent via registered mail with return receipt.
7If your initial offer is rejected, draft a counteroffer letter outlining in detail why you are unable to pay the amount they are requesting. Restate what it is you can and are willing to pay and how and resend the letter via certified mail, again requesting that they send signed confirmation if they agree to your terms.
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