A collection agency has my debt. Can I negotiate with the original creditor?

Ask the creditor to take your debt back from the collector, so you can negotiate with the creditor.

By , Attorney

If you're ready to negotiate on a debt, you'll probably be better off talking to the creditor, not a collection agency. This is because the creditor has more discretion and flexibility in negotiating with you, and might see you as a former and possibly future customer.

Ask the Creditor to Take the Debt Back

If you want to negotiate directly with the creditor, ask the collection agency for the phone number of the collections department of the original creditor. Then call the creditor and ask if you can negotiate on the debt directly with the creditor.

Ideally, the creditor will immediately negotiate with you, and you'll work something out. Unfortunately, that's rare. It's more likely that the creditor will only take the debt back if you negotiate with the collection agency, establish a repayment plan, and make two or three payments under the plan. If this happens, the creditor might eventually give you a new line of credit, helping you rebuild your credit.

If You Do Make an Agreement With the Creditor

If the creditor does agree to negotiate with you, make sure it owns the debt. If the collection agency bought the debt from the creditor (rather than the creditor just assigning the debt to the agency for collection), the agency owns the debt. If you negotiate with and make payments to the creditor, the collector may refuse to credit you for those payments.

You can negotiate a payoff of the debt in one lump sum, or perhaps you can negotiate a better payment plan. These are the same options available if you negotiated directly with the collector, although the creditor may be more flexible and willing to compromise. (To learn more about these options, see Negotiating With Collectors on Unsecured Debt.)

Also you might want to ask to have the negative credit information on the debt removed from your credit file, or shown as payment in full, if you make the payments under the new agreement. (Learn more about negotiating improvements on your credit report.)

Get It in Writing

Put any agreement you reach with the creditor in writing—preferably, in a letter from the creditor to you, although a letter from you to the creditor confirming the agreement and asking the creditor to correct any errors is better than nothing. Part of the written agreement should be an acknowledgement by the creditor that it owns the debt. Send a copy of the letter to the collector.

When to Talk to a Lawyer

If you need help dealing with a creditor or debt collector, or would prefer someone else handle your debt negotiations, consider talking to a debt settlement lawyer.

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