How to Broker Delinquent Debt

When a credit card account or a medical bill goes 60 days past due, it is generally considered to be a delinquent account. Some credit card companies and medical billing services will keep the collection effort in-house for up to 3 to 6 months, at which time the account is sent to a third-party collector. If you receive a notice of a delinquent account, you can broker it yourself.

Instructions

1

Verify the debt. If the delinquent account is being serviced by a third-party debt collector, request that a verification of the debt be sent to you. This information includes the name of the original creditor, the amount owed and a verification that the debt is legally yours.

In addition, verify the debt by requesting a copy of your credit report from each of the three credit reporting agencies: TransUnion, Experian and Equifax. By law, you are entitled to one free copy from each bureau per year. Under federal law, each agency must verify the debt or remove it from your report.

2

Contact the credit card company, medical billing service or third-party collector. Request to speak with a manager or supervisor. If the representative refuses, politely end the call and phone back later. Once speaking with a supervisor or manager, offer to settle the debt in a lump-sum payment for 40 or 50 cents on the dollar. Repeat this process until your offer is accepted.

3

Demand the company delete or reword the debt trade line. Your credit report will reflect the delinquent debt for a period of 7 years. Tell the company your settlement offer is subject to having the trade line or debt deleted from your credit report or to read "paid as agreed" or "paid, account closed."

4

Insist the third-party debt collector, medical billing service or credit card company place the accepted settlement offer in writing on its official company letterhead. Have a copy mailed to you and return a copy of the settlement offer with a money order or certified check for the exact settlement amount. Once the settlement is paid, forward a copy of the settlement offer to each credit bureau and request the trade line be deleted or worded according to the agreement.

5

Reorder your credit reports. Allow about 90 days before reordering your credit reports to confirm the debt has been reported as paid.