As far as negotiating goes, it might be useful to see just how good some of these folks are but remember that you're at a disadvantage to a counter-party that deals with debtors like you day in and day out. The good ones know every trick and argument and their one job is to get money out of you before you hang up the phone. They can be very persuasive. The bad ones are downright abusive and you'll hate yourself for talking to them in the first place.
From my experience, the first few months they're all about getting 100% payoff plus penalties and a really high rate of interest. After 90 days, they start softening their stance and are willing to do payment plans with no interest or some mild offer like 80 cents on the dollar. When the debt gets moved to either their law firm or sold off, the deals get more aggressive, while your chances of getting sued increases.
So is there a best time? Not really, since the tradeoff is discount vs. lawsuit the whole time. And even if you're not really engaging them, their stance is changing: you'll see that in the voicemails they leave and the letters they send. Sometimes its aggressive, sometimes more open and conciliatory. For the amounts that you're talking about, half of them will move to sue pretty quickly and the other half will drag it out and try to negotiate with you, even if you're not looking for an offer.
Now if you're worried about getting sued, I'd look to ways to delay and stretch them out for the 10 months until you file. I never did that and have been sued by several of my creditors, but I'm basically judgment proof and not particularly concerned about the record. The only thing I'm mindful of is keeping my bank account below the levy threshold. I'm also unemployed so I have no wage garnishment issues, and don't really plan on having to explain in a job interview why my blemished (and bruised) credit score doesn't make me a bad person.
Now on a side note, if you are interested in working in finance, there is a fair amount of work in distressed companies, turnaround, and bankruptcy. What you're going through in wanting to protect your credit score is what a lot of business leaders and managers go through when their company is going down. Actually going through bankruptcy and learning how beneficial it is to you financially, and what it teaches you about creditors and debtors, assets and liabilities, is a powerful perspective that you'll never get from a classroom. It should put you at an advantage over someone with perfect credit and no idea how to handle things when the going gets rough. So while I've never been in a position of having to explain my credit score in a job interview, my only response would be to say that my problem wasn't my credit score, it was my insolvency, and my remedy was filing bankruptcy.
From my experience, the first few months they're all about getting 100% payoff plus penalties and a really high rate of interest. After 90 days, they start softening their stance and are willing to do payment plans with no interest or some mild offer like 80 cents on the dollar. When the debt gets moved to either their law firm or sold off, the deals get more aggressive, while your chances of getting sued increases.
So is there a best time? Not really, since the tradeoff is discount vs. lawsuit the whole time. And even if you're not really engaging them, their stance is changing: you'll see that in the voicemails they leave and the letters they send. Sometimes its aggressive, sometimes more open and conciliatory. For the amounts that you're talking about, half of them will move to sue pretty quickly and the other half will drag it out and try to negotiate with you, even if you're not looking for an offer.
Now if you're worried about getting sued, I'd look to ways to delay and stretch them out for the 10 months until you file. I never did that and have been sued by several of my creditors, but I'm basically judgment proof and not particularly concerned about the record. The only thing I'm mindful of is keeping my bank account below the levy threshold. I'm also unemployed so I have no wage garnishment issues, and don't really plan on having to explain in a job interview why my blemished (and bruised) credit score doesn't make me a bad person.
Now on a side note, if you are interested in working in finance, there is a fair amount of work in distressed companies, turnaround, and bankruptcy. What you're going through in wanting to protect your credit score is what a lot of business leaders and managers go through when their company is going down. Actually going through bankruptcy and learning how beneficial it is to you financially, and what it teaches you about creditors and debtors, assets and liabilities, is a powerful perspective that you'll never get from a classroom. It should put you at an advantage over someone with perfect credit and no idea how to handle things when the going gets rough. So while I've never been in a position of having to explain my credit score in a job interview, my only response would be to say that my problem wasn't my credit score, it was my insolvency, and my remedy was filing bankruptcy.
Bankruptcy Wizard
(just an odd irony on mind set).
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