By now, many consumers have heard that it is possible to negotiate with their creditors and settle their debt for less than they owe. There are hundreds, if not thousands, of companies and financial professionals that will help consumers accomplish this. The problem is that these professional negotiators are expensive. If a consumer can no longer afford to pay their bills, why would they want to add another expense to their already long list of debts?

Fortunately, consumers don’t have to enlist the help of a professional. It’s possible for consumers to negotiate directly with their creditors, as long as they know a few helpful tips.

Negotiate and Pay Off Debt with These Tips

Before negotiating with creditors, consumers need to have a plan. Most creditors will not agree to accept a lesser amount and then allow the consumer to make payments on what they owe. To have real negotiating power, a consumer must be able to offer a lump sum for a debt. Until this is possible, the consumer will need to budget and save part of their income, until they have enough to begin negotiations.

Once a consumer has saved enough to begin negotiating, they will need to contact one of their creditors. They may do so in writing or by phone. Either way, they will need to take careful notes of each conversation. If negotiations are handled in writing, make copies of all correspondence. If negotiating over the phone, write down the date of each phone call, the name of the representative, and what was discussed.

While negotiating, never ask a creditor what they are willing to accept as payment. Consumers would benefit more from explaining how dire their financial situation has become and letting the creditor know how much they can afford to pay. Start negotiations out low, since creditors will not usually accept the first offer.

When negotiating, be firm. Debtors should not agree to pay more than they can afford, give out account numbers, or supply any information they are not comfortable giving. Creditors can be difficult to negotiate with at times. If a consumer feels unsure of their abilities, they should start trying to negotiate their smallest debts first. By the time they begin negotiating larger balances, they will have a bit of experience on their side.

It is also important to get all agreements in writing. Do not take any debt collector or creditor at their word. If they accept an offer for a settlement, ask them to send paperwork verifying their acceptance. Consumers need to protect themselves throughout the negotiation process. When negotiating carefully and persistently, consumers will be able to successfully settle and pay off debt for less than they previously owed.