Debt negotiation is between two parties, the creditor or collection agency and the person who owes the debt. A negotiation takes place between these parties to determine a settlement amount that would consider the debt settled or paid in full.

For example, if you owe $10,000 on a credit card debt, then you or your debt negotiation attorney can offer to pay a lower amount, say $5,000 to consider the debt settled or paid in full.

Before entering into negotiation, make sure the debt isn’t a zombie debt (debt that has far surpassed the statue of limitations of your state’s statutes). You are not legally obligated to pay zombie debt, and sometimes paying these types of debts will negatively impact your credit score. If you make even a single payment on a debt that has passed the statute of limitations, it resets the statute and the creditor will have many more years to file a lawsuit against you.

The key to good debt negotiating is having a good understanding of consumer debt laws. Knowing the laws can provide leverage in your favor. You also have to know how to talk to creditors or debt collectors in order to achieve favorable results.

If you hire an experienced debt negotiation lawyer, they could help you achieve a much lower payoff amount than if you were to attempt to negotiate yourself. For a free case evaluation, contact us.