How to Contact a Collection Agency to Pay a Bad Debt

Paying a collection account has little financial benefit for consumers since satisfying the debt does not positively impact their credit scores. Certain lenders, such as mortgage companies, often require consumers to pay off outstanding debts before doing business with them. Some consumers pay collection accounts not because of a pending loan, but because of a moral obligation to satisfy their debts. Calling the collection agency and conducting payment negotiations over the phone my seem simple, but doesn't provide you with proof in the event the company later sells the debt or claims you did not pay. Communicating in writing eliminates this risk.

Instructions

1

Pull your credit report. The Federal Trade Commission notes that you can request a copy of your credit report for free online at AnnualCreditReport.com

2

Locate the "Accounts in Collection" section of your credit report. Review it for the collection agency's tradeline. Write down the company's exact name and address as listed on your report.

3

Write the company a letter noting your intent to pay. If you want to settle the balance, note that fact and how much you're willing to pay in your letter. Include that all communication concerning your payment must take place in writing and that it is inconvenient for you to receive collection calls at home. Federal law then prohibits the company from calling you at home -- forcing it to conclude negotiations with you in writing.

4

Mail the letter to the address listed on your credit report. Use certified or registered mail and ask for a return receipt. Doing so forces a collection agency employee to sign for each letter you send and you receive a copy of that signature. This prevents the company from being able to claim it never received correspondence from you.

5

Make a copy of your letter and any responses you receive from the collection agency throughout the negotiation process. Put the paperwork somewhere safe in the event you ever need to prove that you paid off the debt or that the collection agency agreed to accept a lesser amount as payment in full.