Talking with debt collectors, let alone negotiating with them, can be intimidating. The experience of debt collection can stir up many emotions and compound the stress you may be facing. But know that you are not alone in facing debt collection or in navigating a solution. It is often possible to successfully negotiate with debt collectors to find an arrangement that works for you and your financial situation. Use the following tips and phrases when negotiating payment options with a debt collector. 

Legitimate debt collectors are required by law to provide detailed information about the debt they say you owe and to show that the collection attempt is not a scam. Learn how to review a debt collection notice to determine who sent it and how to respond.

Prepare for the Call

Before negotiating with a debt collector:

• Gather all relevant account numbers, amounts owed, payments made, previous debt collection notices, documentation of past conversations or agreements, and other information about your debt 

• Determine how much you can afford to pay monthly, even if that amount might change in the future

• Practice and build your comfort with the following phrases and responses to use during the call

You have rights! It’s against the law for debt collectors to call you at unusual hours or disobey your instructions about when and how to contact you.

Key Phrases to Use In a Debt Negotiation Call

Expressing your situation (you don't have to provide details):

• "I would like to find a repayment solution that is better for my financial situation.”

• "I would like to settle the debt and find a repayment solution that works for both of us."

Proposing a payment plan:

• "Right now, I can commit to [monthly payment amount based on your budget] a month. I will contact you if my financial situation changes."

• "I am committed to paying the amount I owe, but right now I can afford [monthly payment amount based on your budget]."

Declining a proposed repayment plan:

• "I appreciate that you are willing to work with me, but I need to consider all of my financial obligations and bills. Right now, I can commit to [monthly payment amount based on your budget].”

• "Unfortunately, I cannot commit to that repayment plan at this time, but I can make [monthly payment amount based on your budget]"

Other Tips to Remember:

• Remain calm and composed while on the phone with the debt collector

• Take time to carefully consider repayment offers. You can ask the debt collector to call you back if you need more time

• Document the conversation, including who you spoke with and any payment arrangements they offered 

• DO NOT agree to a repayment plan that you cannot afford or that is outside of your prepared budget

• DO NOT agree to automatic withdrawals from your bank account unless you are absolutely sure you can afford the amount that will be deducted each and every month

• Keep in mind that if your only source of income is from protected benefits such as Social Security, disability, or unemployment, making payments on most debts is likely not in your best interest

• Although seeking bankruptcy protection may seem like a scary and drastic option, know that there is a lot of misinformation about bankruptcy. Bankruptcy is often a good option for dealing with significant debt, and there are qualified, reputable local bankruptcy attorneys who offer free consultations.    

• Request written documentation from the debt collector for payment arrangements you have agreed to prior to beginning a payment plan

• Set reminders for payment arrangements you have agreed to

• Keep good records of all payments made under any payment plan you negotiate until the debt is fully paid and you receive notice it is fully paid

This article references information from the Consumer Financial Protection Bureau. Consumer attorney Kelly Jones has reviewed all information for accuracy and clarity.