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Proposing a lump-sum settlement is generally the best optionand the one most collectors will readily agree toif you can afford it. A collection agency will have more incentive to settle with you if you can pay all at once.
Do Collection Agencies Do Payment Plans? Some collection agencies do consider payment plans. However, they are not legally obligated to agree to a payment plan. And in some cases, even if they agree to a payment plan, they may change the agreement later or file a lawsuit for the remaining amount owed.
Once you and the debt collector have reached a written agreement for paying off the debt, you'll make your payment. The most secure way to make a payment to a debt collection agency is by sending a check through the mail with a return receipt. This will prove that the check was accepted by the collection agency.
Even if a debt has passed into collections, you may still be able to pay your original creditor instead of the agency. Contact the creditor's customer service department. You may be able to explain your situation and negotiate a payment plan.
Typically, a creditor will agree to accept 40% to 50% of the debt you owe, although it could be as much as 80%, depending on whether you're dealing with a debt collector or the original creditor. In either case, your first lump-sum offer should be well below the 40% to 50% range to provide some room for negotiation.