- 1). Ask for an accounting for the final amount of the debt. In the time since you've paid on the account or worked with your creditor, late fees and other collection amounts may have been added, making the amount different than what you thought it was. Request the amount of the debt in writing from your creditor.
- 2). Request a settlement amount. Be prepared to go back and forth with your creditor until you settle on an amount. Sometimes, depending on how old the debt is, your creditor might be willing to settle for up to 50 percent of the original debt; adversely, some debtors might not be willing to negotiate at all. When you call, ask to speak with an account manager, since this is the person who has the authority to negotiate, and not a customer service rep from the call center's general pool.
- 3). Propose a time line in which to pay the settlement amount. The quicker you are willing to pay off the debt, the more likely it is the creditor will accept the terms of the settlement. Be sure that whatever time line you propose is one you stick with; if you miss payments or violate the terms of the settlement agreement, then you may find that your creditor dismisses the agreement and goes back to requesting the full amount due on the account.
- 4). Keep track of your payments and request an update to your credit report once the account is paid in full. Keep in mind, however, that the impact on your credit might not be as favorable as it might have been had you paid the amount of the debt in full because you settled for a lesser amount.
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