29 Mar Debtor Wants to Pay Creditor – Creditor Refuses to Negotiate in Good Faith
I am currently involved in a negotiation with a collection agency regarding my client’s debt with a large credit card issuer. My client owes about $60,000 and she does not want to file for bankruptcy. My client does not own a house and she works as a consultant, meaning that she can make good money when employed, but she may go several months without having work.
Looking at this situation objectively, I would think that the credit card lender would recognize that my client is actually a good candidate for Chapter 7. Yes, she would have to “lay low” for a few months to get her income below the median, but a few months of sacrifice on her part could result in discharging close to $100,000 of debt (including the $60,000 owed to the one credit card lender).
One would therefore think that the credit card lender and its representatives would bring a tiny bit of reasonableness to the debt negotiation table. If one thought that, however, one would be wrong.
As we stand now, the collector is willing to accept the full balance, with interest, over 24 months in equal monthly installments. Further, the phone rep refuses to give me anything in writing. He wants my client to send the first three payments and then his company will issue “something” in writing.
Needless to say, I am not inclined to advise my client to trust a collection agency and to send them money. This is apparently their best and final offer. So, what we have here is a bankruptcy eligible person who does not want to file bankruptcy and who wants to pay back her debt. She would like to see the interest rate reduced or eliminated and she would like to see the balance reduced as well, but I think her main concern here is a desire to finalize a deal. The lender’s representative is basically going to force my client to file for bankruptcy because of his unreasonableness.
Jonathan Ginsberg, Esq.
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