Creditor For X% Of The Debt?
Q: I have heard that a tool to avoid bankruptcy is to send a check to the creditor for X% of the debt. On the back of the check, the debtor writes something to the effect of 'Depositor agrees to accept this check as full payment and settlement of debt and agrees to update credit reporting agencies as settled debt'. Has anyone heard of this? If so, how should it be worded? The goal would be have the creditor change previously 'written off' accounts to 'settled' on credit reports
A: - It works only in the narrowest of circumstances. It is in your best interest to have a settlement agreement before issuing the check. It absolutely does not work if you send a check through the normal payment processing channel of a major cr
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