Offer 25 Percent or Less
A little-known fact: if a collections agency purchased your debt from the original creditor, they paid pennies on the dollar for the debt. Everything they receive over that amount is profit. Start low, offering a quarter of the original debt and not the inflated amount with miscellaneous interest and collection fees.
Check the Statute of Limitations
Depending on the state in which you live, you may no longer owe the debt if it's older than several years. In some states, the statute of limitations for open-ended accounts, such as credit card accounts, is as little as three years. However, the debt can stay on your credit report for as long as seven, regardless of whether you still legally owe. Offer only a couple of pennies on the dollar to make those debts disappear.
Bottom Line
Depending on the age of your debt, offer only a few cents to 25 cents for each dollar of the original debt. Communicate only in writing, if possible, and send registered letters.
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