How To Negotiate Alternative Payment Plans With Collection Agencies

When you are unable to pay off your loans/debts, the creditors may assign or sell the debts to a collection agency (CA). Instead of the creditor or CA calling you for payments, it is always better to contact your creditor/creditors and negotiate for alternative payment plans. However, if a collection agency contacts you, at first, verify whether or not the Statute of Limitations (SOL) on that particular debt has expired. If it hasn’t expired yet, you can start negotiating with the CA for an alternative payment plan.

Collection agency – What it is

A collection agency (such as, NCO collection agency) can be defined as a business that pursues payments on debt/debts that are owed by businesses or individuals. First party collection agencies are often subsidiaries of the original company to which the debt is owed. Third party collection agencies usually work on a commission basis. They receive a percentage of the amount they’re able to collect from the debtors. A CA can also purchase a debt from a creditor and collect the owed amount from the debtors.

Do’s and don’ts of dealing with a collection agency

Go through the following lines to know about the do’s and don’ts of dealing with a collection agency (such as, NCO collection agency).


1.Note the physical address – Before starting off a negotiation, always take down the name as well as the physical address of the collection agency. In addition to this, note the fax and phone numbers and keep a record of them.

2.Get everything in writing – Always ask for a written agreement before you pay any amount to the CA. Make sure your read the agreement carefully and never rely on what the agency has said to you verbally.

3.Be patient while negotiating – Try to be patient and never lose your temper while dealing with a collection agency. It may not agree upon a repayment plan if you lose your temper during negotiation.

4.Keep records of every correspondence – You should always keep a copy of every letter you send to a CA. It is advisable that you send each and every letter by certified mail with a return receipt request.


1.Talk over phone to negotiate – If possible, don’t negotiate with a CA over phone. A face-to-face communication helps to negotiate in a better way.

2.Be too impatient to settle a debt – Do not show your eagerness to settle a debt; the longer it takes to settle a debt, the better your chances to get a good deal.

Following the above do’s and don’ts will help you to negotiate with a CA (such as NCO collection agency) for settling your debts or working out an alternative payment plan that you can afford.

Useful Resources : -

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