Debt Settlement May Be Just What You Need!

When you have too many credit accounts and cannot meet the minimum payments required, then it may be time for you to consider a DEBT SETTLEMENT PROGRAM.


There are many reasons a financially stressful situation like this can happen, but some of the most common are:

  • Loss of employment or layoff
  • Too little income in retirement
  • Unexpected medical bills
  • Increasing cost of medications
  • Divorce
  • Disability
  • Loss of spouse or partner



These are just some of life experiences that can financial hardship.

If one or more of these sounds like what you are going through, you may have several options:

If you have enough equity in your home, a refinance or equity line of credit may be a solution.  

If you qualify for a consolidation loan or balance transfer and the interest rate is not too outrageous, then that may work.

You may qualify for a Credit Counseling or Debt Management Program.  But if you are having a hard time keeping up with the total due for all of the minimum payments now, most likely this type of program will not help.

What about BANKRUPTCY?

I believe bankruptcy can be a viable option if you have tried all other options.  Bankruptcy laws have changed over the last few years to prevent someone from trying to use bankruptcy to discharge debt when they possibly could meet their promised to repay!


If you have missed a couple of months of making the minimum required payment due on all of your accounts or cards, they are probably getting close to being "charged off".  

When this happens, the account will most likely be transferred or sold to a third party debt collector or debt purchasing company.

Most people are not aware that there is a multi-million (or most likely) billion dollar industry that purchases old, delinquent debt for pennies on-the-dollar for collection!

Let's say you have a credit card and due to circumstances beyond your control you just cannot make the payments.

The original creditor will call and send letters trying to get you to start making payments again.  But after 3-4 months, the account lands with a Debt Collector.

Now the Debt Collector starts calling, and calling, and calling.....

The good news is that now you can put a stop to those annoying calls!

STOP Collection Calls Free Sample LetterBut the letters keep coming!

These letters will try to get you to pay or in some cases, they may offer to SETTLE THE ACCOUNT for less than the balance due!

This offer may be anywhere from a small reduction or possibly a very good reduction.  

You may also be able to contact the debt collector to NEGOTIATE a better settlement or perhaps to let you take advantage of the settlement offer by making a series of monthly payments that you can afford.

Negotiating with debt collectors can be very time consuming and stressful.

I've been helping people deal with the stress of too much debt and negotiating with debt collectors (many time attorneys) for many years, so I know from personal experience!

The agent for the debt collector's job is to get as much money out of you as possible!  In many cases, their income, commission or bonus depends on being very inflexible.

The agent will try to intimidate you and in many cases try to shame you into getting you to pay back all of the balance!

There are laws that protect consumers from illegal collection tactics, but most people are not aware of them.

I've written several articles about dealing with debt collectors.  Here's one that may be especially helpful:


Debt Collectors, the FDCPA and Your Rights


For the sake of this blog, let's say that you negotiate a settlement for less than the balance due...NOW WHAT?

DO NOT, I repeat, DO NOT make any payment (by phone or mail) without a WRITTEN SETTLEMENT AGREEMENT!

A settlement agreement is basically a modified contract from the original contract (application) you signed when you took out the card or loan.

If the agent will not email, fax or mail the written agreement, then no settlement/no payment....PERIOD!  It is your only proof of payment once the agreement is completed.

Here is link to what a settlement agreement looks like:

Once the settlement agreement is completed, you can request a letter or statement showing a $0 balance, but if they will not comply, then your cancelled check or bank statement showing payment along with the settlement agreement will suffice.

Over time, you can get yourself back to being DEBT FREE! 

If all of this sounds like a little too much for you to handle, let us know:

Personalized  Program Comparison Click here!


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Tags: what can a debt collector do, stop debt collector calls, Credit Card Debt Negotiation, debt settlement help, Oregon debt collection, settlement, mimimum payments

How Does Consumer Debt Collection Work?

Have you ever been contacted by a Debt Collector and wondered why they are calling you and how in the world they got your number?  In this post, I will attempt to explain the Consumer Debt Collection process and what to expect when they start contacting you.

The Beginning of Consumer Debt Collection

The consumer debt buying industry began in the early 1990's when the US government started selling off assets from savings and loan banks that had failed.

As consumer debt has grown exponentially over the past decade, the number of debt collection firms has skyrocketed as well, growing from about a dozen firms in 1996 to several hundred today.

The big credit card companies are not able to devote the enormous amount of time and money into pursuing the thousands of people who fall into debt each year, and debt collection companies are eagerly stepping in to buy the debt from creditors for a fraction of the total debt.

Last year debt buyers paid an average of 5.4 cents for every dollar of unpaid debt they bought. Debt collection is a very lucrative business. (CHA-CHING!)

The Federal Trade Commission (FTC), which monitors the complaints lodged by consumers against debt collectors, regularly receives more consumer complaints about debt collectors than any other industry. However, the number of complaints has quadrupled in the past five years.

How Consumer Debt Collection Works!

The typical debt collection company will purchase your debt from the original creditor who is essentially trying to cut its losses.

The debt collector will then attempt to recoup any, if not all, of the original debt. The worst part is not that the debt collectors are trying to collect on an old debt, but instead, it is the Fraudulent Debt Collection practices they use.

Some particularly nasty debt collection companies are resorting to illegal practices -- verbal abuse, harassment, and even threats of violence and lawsuits -- in an attempt to squeeze money from consumers for the debts the company has purchased.

In fact, many times the debt collection company isn't even bothering to harass and abuse the right consumer.

For example, the Washington Post reported that a New Hampshire man was repeatedly called by a debt collector about a loan his daughter owed even though the daughter had moved out 15 years earlier. The debt collector reportedly called this man six times in 15 minutes!

On the last call, the debt collector told the man his Social Security number, his wife's name, and threatened to send thugs.

Another particularly troubling recent practice is the growing number of cases where debt collectors persuade consumers to pay just a little of the amount due, and then they use the bank info to improperly withdraw more money from the consumer's bank account.

Know Your Rights!

The FTC enforces the Fair Debt Collection Practices Act, which outlines consumer rights and prohibits debt collectors from engaging in unfair, deceptive, and abusive practices.

The key to protecting yourself, and your sanity, is to KNOW YOUR RIGHTS!

how does consumer debt collection work


Tags: consumer debt collection, common collection practices, what can a debt collector do

What Can a Debt Collector Do?

what can a debt collector doWhat legal options can a debt collector exercise in trying to collect an outstanding debt?

When you do not keep up with the minimum monthly payments due on your credit cards or other unsecured debts, the original creditor may decide to charge the delinquent account off.

It may be transferred to one of hundreds of collection agencies or to a law firm that only specializes in collection of debt.

The goal of a settlement program is to negotiate settlements on outstanding debt far below the current balance.  This may be anywhere from 35% to 80%, depending on the debt and many other factors.

The first option a debt collector has is to try to get you to pay as much money as possible.  They use many illegal methods that violate the Fair Debt Collection Practices Act (FDCPA) such as:

  • Frequent and harassing phone calls
  • Calling at your place of employment
  • Mailing threatening letters
  • Making threats of lawsuits or other legal action
  • Lying by saying that they never work with 3rd Party Debt Settlement Companies like DRNW, Inc.

We know how annoying these calls can be and have FREE INSTRUCTIONS HOW TO STOP THE CALLS.

The second option a creditor may exercise is to file a claim

If a reasonable settlement cannot be reached, the creditor or collector may decide to retain a law firm that specializes in debt collection to file a claim.

This is processed with your local county court (usually small-claims court) and you would receive or be served a summons.  This is a legal document stating that a claim has been filed against you for the debt you owe.

It will state that you have 20 or 30 days to “answer” the claim.  An “answer” is you responding to the claim saying that you do not owe the debt and stating the reason why.

But since 99.9% people who do receive the summons do, in fact owe the money, there is no reason to spend the court fee to file your “answer”.

It is very important that you do not ignore the summons!

If you have received a summons and would like personal, professional help in dealing with it, please let us know!

In most cases, we will work out an agreement in lieu of them going forward with the claim and that will be the end of that.

If a reasonable settlement or agreement cannot be arranged, then the creditor (plaintiff) will be awarded a judgment by default.  You do not have to go to court or hire an attorney (unless you decide to dispute the validity of the claim) and they will win the judgment by default.

Once the default judgment has been awarded, not the creditor has a couple of more options:

If you have a job and are paid normal, W-2 income, they may decide to apply for a writ of garnishment in order to have your employer pay a percentage of your paycheck to the creditor until the debt is repaid.

Each state has a little different law, but in most state, that would be 25% of your net, after-tax income.  There are also different exemptions that may or may not apply.

If you are self employed it is very difficult for a creditor to get a wage garnishment.

If you are retired, they cannot touch your retirement income (more later).

To prevent the creditor from exercising their legal option ONLY AFTER THE JUDGMENT HAS BEEN AWARDED,  you can negotiate an agreement whereby you agree to repay the debt (sometimes at a reduce balance) over time with a payment from your reserve account.

We have many years of experience in helping clients and would be glad to help you also. 

Click here for a FREE EVALUATION.


A debt collector cannot just decide to garnish you wages without going through the entire legal process and this usually takes several months, giving us enough time to negotiate a settlement or other agreement.

In rare cased, ONLY AFTER THE JUDGMENT HAS BEEN AWARDED, a creditor may apply for a writ or levy to your bank account.

In short, if you are Retired or Disabled, the creditor (again, only after awarded a judgment) CANNOT TOUCH YOUR BANK ACCOUNT!

But, you cannot CO-MINGLE funds in your checking or savings account.

If you work a few hours here or there, win some money at the casino or receive a gift, DO NOT DEPOSIT INTO YOUR BANK ACCOUNT WITH YOUR OTHER RETIREMEN FUNDS!!!!!

Click a link to a great blog of ours about EXEMPT INCOME.

Debt Relief NW, Inc. is not a law firm and does not give legal advice. 

what can a debt collector do

Tags: debt collection harassment, how to stop collection calls, what can a debt collector do

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