A reader asked for advice in response to a collection agency demanding a lump sum and refusing to accept a payment plan..

Hi DP,

I have a question for you regarding a collection agency. I have a credit card account with Bank of America, which just went 6 months past due. I have been unemployed and now have a job. I’ve been working with Bank of America through a payment program, but they recently sold the debt to an outside agency. I just received a call from this outside agency stating they are willing to settle for $7,000.00, but they want it in full by tomorrow (which can’t happen). I attempted to ask them if I can be placed on a payment program until I am willing to pay the balance in full in June 2009. I attempted to be proactive and make payments, but they will not accept. The man on the phone was extremely rude, stated they do not accept payment programs, and are planning on taking legal action. Any advice? Thanks so much-

Debt Prison response..

Tell them they can settle for oh say… $300 bucks or they can take you to court and have the judge put you on such a payment plan.  There’s nothing these guys can do in court but get a judgment, in which case, if you pay some on it each month there’s nothing they can do.  These collectors know this and are betting on your ignorance of this matter… they are counting on you coming up with the $7,000 cash.  You’d be surprised just how many get stressed out and cough up the cash.  These guys can really get your blood boiling. Unless you plan on paying the $7,000 I’d just write them a letter…  let’s see what we can come up with here….

Write a letter (registered) and say that you can pay $500 a month (or whatever you can pay)… and that you are attempting to satisfy this debt but they are making it impossible by demanding a lump sum. Tell them that when they are ready to put a payment plan IN WRITING that you’ll be happy to discuss the matter with them further, and until then to leave you alone… If they would like to start acting like adults you’ll be glad to work with them.

I’d then keep copies of the letter and the receipts from the post office showing where they signed for it.  I’d also mention in the letter that if they decide to take this to court that you’ll be showing this letter to the judge..

Good Luck and hope this helps..

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