Debt Negotiation & Settlement

If you are struggling under a mound of debt, you may be able to work with creditors and even debt collectors to make things more manageable. This is often called debt settlement or debt negotiation. For example, you might settle a debt by getting the creditor to accept a lower amount if you pay a lump sum up front. Or perhaps you can negotiate lower payments, either temporarily or permanently. Before you contact the creditor or collector, figure out your goals and pick a few negotiation strategies. Below you’ll find articles to help you through the process.

The Robinson Law Firm PLLC offers assistance to individuals seeking a reduction in debt owed. We currently defend individuals in the state of New Mexico if they have been sued by a creditor. If you have been sued by a bank, credit card company, third-party debt buyer or other creditor, we can help.

Our firm will perform a thorough analysis to determine if you have a defense to the lawsuit, which might include statute of limitations issues, erroneous contracts and paperwork, assignment errors and many other defenses. We understand your legal rights in a collection lawsuit and we use the law to protect your interests. The Robinson Law Firm PLLC will contact the consumer’s creditors individually and negotiate a lump sum payoff. We will seek an affordable payoff amount for the client. Our goal is to help individuals become debt free.

How much can a person expect to save with Debt Negotiation?

There is no set amount or percentage a consumer can expect to save. It depends on the creditor or the collector and the debt. However, a consumer can save as much as 50% or more when using an experienced attorney.

Are there any drawbacks to Debt Negotiation? Yes, the most obvious being the consumer’s credit report will show a settlement for the debt which is not as good as paying the debt in full. However, for a debt that has been charged off as a bad debt by the creditor, a settlement will result in a better credit score than no payment on the debt or a charge off or a judgment if you are sued. The consumer must also have a source of funds for paying the lump sum or installment (monthly payments) settlement.

Generally, the creditor or collector will give the consumer 90 days to pay the settlement if a lump sum settlement is made. Finally, any money saved in the settlement may have tax consequences. It is important to consult with a tax professional or attorney. How can an attorney help with Debt Negotiation? An attorney can negotiate the best settlement of your debt. Many factors determine the amount of a settlement. An experienced attorney understands the importance of these factors to negotiate the best settlement.

Debt Negotiation & Settlement FAQs

What is debt settlement?
Debt settlement is a process by which your creditor is contacted and your debts are negotiated for repayment at an amount less then you owe.

What types of debts do you negotiate?
Credit card debt, medical debts and personal judgments. Student loans, auto loans and mortgages can be settled but the process is more complex and extensive.

Who is eligible for debt settlement?
If you have outstanding credit card bills, medical bills, payday loans and personal credit union loans are office will assist with representation.

How much debt must I owe to receive assistance?
There is no set amount. However, if your debt is less than $500, we recommend you consider contacting the creditor, but if you prefer our assistance we negotiate the debt.

How is debt negotiated?
We negotiate with creditors to reduce the amount owed on the debt and the agreement is put in writing “Stipulated Agreement”, which will explain the terms of the agreement by which payment arrangements will be made and executed over a period of time. We settle debts with our clients payment benchmark in mind as our goal is to create a positive outcome for all parties involved.

What are your debt settlement service fees?
All initial consultations are FREE. We charge a fee of $99.00 per month. Your first month fee includes a debt consultation, a review of all creditor correspondence related to the debts you want settled and an outline of our settlement strategy and goals. If your debt requires that the we file an Entry of Appearance and Answer to a Complaint you received from the creditor you will be assessed a flat fee of $150.00 plus the first month introductory fee of $99.00. Thereafter, you will be assessed a fee of $75.00 per month until the debt has been resolved and an agreement is in writing.

How long does the debt settlement process take?
This can be tricky as it depends on the amount of debt outstanding, age of the balance, the funds you have available to go towards the settlement and how much time you need to save additional funds for the settlement. The most critical factor in the process is the creditors willingness to negotiate a settlement amount. Our office normally will settle a debt within 2 to 6 months depending on the complexity of the case. Our objective has always been to have the debt settled as soon as possible.

Will your office be able to stop any legal action filed against me?
It is possible but it depends on how long the creditor or collector has been attempting to collect on the debt. If you are worried about your credit report, keep in mind that collection items may only be reported for up to 7 1/2 years from the date you fell behind with the original lender.

Can I negotiate my own debt settlement?
Yes. Anyone who owes a debt can start the settlement process by contacting their creditors. Many people choose to hire a debt settlement company or an attorney because of the experience factor. Others simply do not want to negotiate with creditors.

Are there any tax implications if I have my debt settled?
A debt settlement could become a taxable event under the Discharge of Indebtedness rule from the IRS. The IRS may view your debt settlement as a form of income. We strongly recommend you consult a qualified tax professional to determine if debt settlement will impact your financial situation.

Do you guaranteed success on my case?
No. Not even the very best debt attorneys or debt settlement companies or can guarantee success. We define success by whether our client is happy with the resolution of their case.