Negotiate a Debt Settlement

Is it better to negotiate settlement with a collection agency or original creditor?

I wish to settle debts and clean up my credit. I don't know who to pay...

Public Comments

1. The original debtor may not want to deal with you any further. That's why they turned you over for collection. Try to work something out with the original debtor first though if you can.
2. Your best bet is to pay the original creditor. They are the ones who have been impacted directly. Also they are the ones who have reported the debt and are able to report its resolution. It is also useful in that it can help repair a damaged customer relationship.
3. once your debt has been sold to a collection agency the original creditor is out of the pic. collection agencys buy your debt from the original creditor for a small percentage becasue the orginal creditor has given up on getting their money from you, so you can often work out a better deal with a collection ageny anyway. good luck!!
4. It is always better to negotiate with original creditor, before it goes to a collection agency.
5. Almost all the info you have here is not correct. Collections agencies do not buy accounts, they work on a contingent basis. Some of the info is right. Once the account is assigned to a 3rd party the original creditor does not have the ability to negotiate any longer You must deal with the collection agency. Here are some hints. Do not tell the collector that you are trying to buy something on credit (ie a house or car) and you need this to be paid. This take away your leverage as they now know that you HAVE to pay it and they don't have to take a settlement. Simply tell them that you are trying to make good on your past mistakes and take care of your responsibilities. Most agencies will take a settlement offer, start low and they will counter, don't play too much or it will irritate them and then may just say "forget it, pay it all." Good luck!!
6. I disagree with icsowesmemoney. I have helped many people deal with creditors and collection agencies. I NEVER deal with agencies. Most of the time, creditors will work out a deal. There were times they said that I had to talk to the agency (so they never got paid), and on two occasions the debt was sold to an agent so we had no choice. What's funny about his answer is that some of the agencies will tell you they need to check with the original creditor to see if they accept the offer. So contact the original creditor whenever possible. I have yet to have dealings with agents that were very successfull.