Consumers are always free to negotiate with their creditors to pay off a debt. You should keep in mind, though, that for the most part it is up to the creditor as how far they are willing to negotiate, if at all.

Usually a creditor will be quite open to negotiating the payment of debts to some extent because the creditor wants at least some, if not all, the money owed to them. Driving your credit into the ground will not help them accomplish this goal.

How Do I Negotiate with Creditors?

Your ability to negotiate with your creditors will depend on how much leverage you have with which to negotiate. There are several elements that determine what leverage you might have to empower your strength in negotiations:

  • Cash – if you already have some money available to pay off some of the debt, your creditor will probably be more willing to listen to you, because that more likely lead to the creditor receiving that money. A creditor might be less motivated to negotiate with you if you do not have anything to offer in return
  • Flaws in the information – if the creditor has incorrect information about your debt, and you are able to prove these flaws, this obviously can only help you in your negotiating leverage and you can take a firmer stance in what you want. However, if there are flaws that you cannot prove, you are essentially where you would be if the information were all accurate
  • Unsecured or secured debt – if you have secured debt, i.e. the creditor is holding one of your assets as security, you may have a tough time with negotiating as the creditor may be completely unwilling to work out a deal since they already possess an asset that can be used to pay off all or part of the debt
  • Amount owed – if your debt is not too large, the creditor is not going to want to spend a lot of money to pursue payment and will probably be more open to negotiating a payment method. However, if the amount is too small, the creditor may not want to negotiate at all and insist the whole amount be paid
  • How old is the debt – creditors generally are not thrilled about spending a lot of time trying to collect on a debt. They will generally try to hold off on methods legal action because it could be years before they get to start collecting on the debt. If you are able to offer the creditors a quicker solution, even if means only paying off part of the debt for the time being, your creditor may be more willing to hear you out
  • Federal and state laws – also, be sure to check up on federal and state laws that regulate collection methods so that you can face your creditor knowing what they legally can and cannot do to get their money. This way you will not be panicked by any false threats

Seeking Legal Help

You may want to speak to an credit lawyer who has experience with consumer credit. Your attorney can explain what protections you have under state and federal law, help you decide on a course of action (legal or otherwise) to alleviate your debts.