Collection Agency will not accept reasonable payment arrangement

by Diane
(Daytona Florida)

I owe for breaking an apt. lease $3,218.00). I want to pay it back, but the collection agency made unreasonable downpayment to start repayment. I am on disability and cannot afford either $700 downpayment and then $250 per month to repay. Have tried to negotiate and they will not budge. Are they allowed to refuse my payment arrangement of $200 per month until paid? I have to move in 8 months and will need a good apartment credit rating.

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Oct 10, 2010
Collection agency won't accept payment arrangement
by: Mary

Thanks for submitting your debt collection question on our Q&A page.

No, the agency doesn't have to accept the payment arrangement you have proposed and it won't if it thinks that your proposal is unreasonable or that you can pay more than you've offered. On the other hand, most collectors don't want to have to sue a consumer over a past due debt, so although they would prefer to have a debt paid in one lump sum, they can be receptive to a payment plan when a single payment is truly not an option. Again however, they won?t accept any plan that they consider unreasonable.

Negotiating is a matter of give and take so would it be possible for you to pay a little more than you have offered so far? The debt collector may be unwilling to accept your current offer because he is holding out for something slightly better and he may be refusing to budge on what he is demanding as a means of pressuring you to pay just a little more. So, if you think that you can improve your offer a bit, do so. This time the collector may go for it. Of course, it's imperative that you not offer more than you truly believe you can pay. Also, if the collector does accept your offer, do not pay one penny on it until the terms of the agreement you reach with him are in writing.

I need to warn you however that paying off the debt you owe may not help you rent a new apartment in 8 months. Why? First, negative information like the fact that you have an account in collections can remain in your credit reports for 7 years and 6 months from the date that the account first became delinquent. Second, paying the collector the money you owe won't remove the negative information from your credit histories; that information will remain there. However, it's possible that as part of your negotiations with the debt collector you can get him to agree not only to a payment plan, but also to remove the collection account information from your credit files. Truth is however that is most apt to happen if you pay your debt in a lump sum. It's worth a try though. Also, even if the collector does agree to remove the information, if your landlord reported your unpaid rent to the credit reporting agencies before it sent your account to collections, that negative information will remain in your credit reports. What the debt collector does will have no affect on it.

I hate to be the bearer of so much bad news, but I also think it's important for you to realize that if a potential landlord contacts your former landlord to find out if you were a good tenant, it's very likely that the former landlord will indicate that you broke your lease. That information is apt to make the potential new landlord reluctant to rent to you and it won't matter that you may have gotten the collector to remove the collection account information from your files.

Good luck resolving your debt and finding a new place to rent next year.

Oct 11, 2010
credit card
by: Anonymous

One of my credit cards ended up with a debt collector because the credit card company refuse to work with me. The debt collector has worked with me in paying the debt off. I guess it depends on who your dealing with. Don't ever go with a debt settlement company. That's how this credit card ended up in the debt collectors hands.

Oct 28, 2010
Send Money Anyway
by: Anonymous

Send them an amount that you can afford and document everything (payments made, reps that you have spoken to, dates of calls, etc.)Do this even if they have not set up a payment plan with you. It shows intent to repay your debt.

Many debt collectors work on commission and want a high amount up front so that they can make more money for that month. If you make payments every month based on what you can afford, it is unlikely that they will litigate. Actually, the collection agency does not take legal action, it is up to the original lender to decide to persue litigation.

If this is the only black mark on your credit report, and you are making regular payments every month it may limit where you can rent, but should not shut you out of the rental market entirely. Truthfully, many landlords are desperate for tenants right now.

Also, if a collection agency is harrassing you, or using abusive tactics, you can report them to the FTC, your state Attorney General, and the Better Business Bureau.

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