Posted on Friday, April 4th, 2014 at 3:09 pm
There is a pervasive myth in American society that attempting to negotiate down the amount of one’s debt is a bad thing. This myth is designed to keep you poor, and beholden to the interests of the banks, credit card companies, and other lenders that you’ve met during your quest to live a happy, normal life. The truth is that you have every right to negotiate down your debts, and that the lender or collection agency will usually work with you if you stand your ground and dangle a carrot in front of them. Don’t forget that the fees, fines, interest rates, and negative remarks on your credit report are not unchangeable, universal laws physics that cannot be altered. They aren’t laws at all, actually; rather, they are only policies, arbitrarily set by the lender (and often arbitrarily changed by them, too). Policies that are set arbitrarily and changed arbitrarily can be negotiated. Also, don’t forget that the lender you are using is a business, and it is in competition with every other lending business out there. If the lender is faced with a choice of waiving a few late fees or watching you walk to their competitor and pay them exorbitant interest rates for a while, then it’s no choice at all. The lender would much rather work with you than watch you walk to a competing Northern Kentucky business.
Bankruptcy is a Creditor’s Trump Card and a Fresh Start
In a bankruptcy, you have the ability to force the lender to take nothing (or much less than 100%) in return for their loan. Obviously, this is the worst possible outcome for the lender, and you have a Constitutional right to spring it on them at any time. The lenders know this, and this is a principal reason that they continue to perpetrate the myth that rearranging your debt is a sin; absent any legal way to prevent you from using your trump card, they try to convince you that the trump card is evil. Calling bankruptcy a trump card, by the way, is poetry because Donald Trump has filed for bankruptcy on multiple occasions. The belief in this myth is a major way that the thinking of wealthy people and business owners differs from the thinking of the poor and middle classes. Wealthy people and business owners don’t feel bad about filing bankruptcy or re-negotiating debt; it’s just another business decision. That decision should have no different connotations for you.
You Have Rights When Dealing With Lenders
When dealing with a Northern Kentucky lender, remember to be firm and remember that you have rights. The person you are talking to almost certainly has some ability to help you. If not, his or her supervisor does. However, you’ll catch more flies with honey than vinegar. That means you must be polite and calm. Calling them in a temper tantrum won’t solve anything. They don’t have to help you, any more than you have to work that extra shift to pay their bill. If you have a lender that is abusive – including calling you at odd hours, calling friends and family about your debt, calling you at work, or telling you they’ll have you arrested – ask for the person’s name, employee number, direct line, or any other identifying information you can think of. Tell them you are gathering this information in order to file a Fair Debt Collections Practices Act (FDCPA) violation complaint. If that doesn’t change their tone, get a lawyer to deal with them for you. And if the lender really won’t budge, or if you have so many lenders that you can’t pay the bills even if they do try to help you out, then get ready to file a bankruptcy. Bankruptcy wipes the slate clean and gives you a fresh start.
Lawrence & Associates are Northern Kentucky lawyers who fight for the rights of debtors just like you, every day. Lawrence & Associates can help!
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