Question about making a deal with a collection agency.

Short version of a long story: I have been fighting with a colleciton agency about some very nasty and completely unfair charges that a real estate company piled on my husband when he was renting a place out of state while working there.

They just send me a letter stating that their client is interested in resolving the matter and in order to do so they are prepared to accept only half of the money to settle our account in full and completely delete any negative reporting (if there was any) to the credit bureaus. We want to take that deal and just put this whole thing behind us!

My question is: what should be my next course of action? I feel like I need to send them a letter staying I am accepting the deal but I would also like proof that the account is settled and any negative reporting ( if there was any) has been deleted completely, not just posted as "resolved". I need to be absolutely sure they hold their end of the bargain!

How do I go about that? Is there a customary procedure for something like that?

Message edited 9/7/2012 1:20:46 PM.

Question about making a deal with a collection agency.

I suggest heading over to creditboards forums and doing some reading. Starting with a debt validation letter and the like. Some of these companies will promise you the world then reneg on sending letters or updating credit reports, some even sell the remaining balance on a "settled" account to another collection agency.

Re: Question about making a deal with a collection agency.

I was thinking about the debt validation letter but it's been longer than 30 day ssince I received the first collection letter. I thought that letter only works if sent within 30 days...

Question about making a deal with a collection agency.

Have them send you it in writing and sign it and send it back with payment. Keep a copy.

Re: Question about making a deal with a collection agency.

DEFINITELY research creditboards for guidance.

you need in writing from the company something stating that ALL REPORTING from them be removed upon receipt of payment. You don't want it changed to "settled in full" because that won't mean a thing on your report...it'll still show as a collection and affect your score negatively.

They need to either have everything deleted or everything changed to "current" or account closed.

As long as you have a document from them stating that they will be removing all negative reporting, then i think you're ok to go.

People on creditboards would prob persuade you to take different action so as not to pay anything to these people....but it may just be easier to settle with them in exchange for deletion of info.

Good luck!!

Question about making a deal with a collection agency.

As long as you get a letter from them saying this is payment in full, the amount is settled, the marks on the credit will be removed. etc .etc. that with your payment proof is all you need if it ever comes up again. If they sell the balance to someone else, you have this proof. If it goes on your credit, you show the credit bureau this too. I work in collections and this is all you need.

Re: Question about making a deal with a collection agency.

I also wanted you to know that you may be responsible for the taxes (as income) for the 50% you did not pay.

As long as you have the letter stating their offer, I would sign and write "accepted" and mail them a check. Allow some time and then check with the credit bureaus to make sure they followed through.

Re: Question about making a deal with a collection agency.

Thank you, everyone! My concern is: what if they DON'T remove the reporting after I pay...

I did go on CreditBoards and posted my questing, btw... Thank you for letting me know about that site, never heard of them before!

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Message edited 9/7/2012 1:21:08 PM.

Re: Question about making a deal with a collection agency.

Re: Question about making a deal with a collection agency.

Thank you, maybebaby!

I found a Pay to Delete format letter on the internet and reformatted it to fit my situation, basically saying that I agree to their terms to accept 50% discounted payment to settle in full and delete ALL references of this account from all Credit Bureaus within 15 calendar days of payment. I am asking them to send me a letter on their letterhead agreeing to all those terms and signed by their agency's authorized signatory. I promise them to dispatch the payment immediately upon receiving the aforementioned agreement! I ended with "The letter will be treated as a contract and subject to the laws of my state."

This way, I feel better about them not possibly scre*ing me over!