What constitues a valid settlement offer?

A creditor offered $14,400 as a settlment; I countered with $9,000. I didn’t hear anything for about 4 days. So I called in to see if $9,000 was accepted but they offered $10,400. I said yes thinking it was a counter-offer. I then received a letter yesterday saying they accepted the $9,000 offer and stated the total debt with 30 days to pay. But on the phone, they said they would send a letter confirming $10,400 in letter to go out tomorrow. Can I hold them to the $9,000 since I received the letter saying they would accept that amount or am I now stuck with the $10,400?

Asked on July 21, 2012 under Bankruptcy Law, Oregon

Answers:

S.L,. Member, California Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

An offer is effective upon receipt.  Acceptance is effective upon dispatch.  Since the $9,000 offer was accepted and the acceptance was communicated to you before acceptance of $10,400, then the agreement is for $9,000.  The acceptance of the $10,400 was not sent until after acceptance of the $9,000 had been communicated to you.  Again, acceptance is effective upon dispatch and the agreement would be for $9,000.


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