How can I arrange a lump sum settlement with a collection agency without telling them I am selling my house?

UPDATED: May 25, 2012

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How can I arrange a lump sum settlement with a collection agency without telling them I am selling my house?

The only asset I have is my home and I plan on selling for living expenses.

Asked on May 25, 2012 under Bankruptcy Law, Iowa


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

You don't have to volunteer or offer any description of your financial plans when trying voluntarily to arrange a settlement--so contact the collection agency, propose a settlement, and see if they'll accept it. Bear in mind that it is completely voluntary on their part whether to settle, and under what terms; if they believe you can pay more (e.g. you have a house as an asset) and/or are suspicious that you are not sharing certain information with them, they are more likely to not come to an agreement with you. However, as noted, there is no law requring you to share your plans or financials in proposing a voluntary settlement--its just down to what amount, if any, you and the agency can agree on.

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