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Hi there, Michael Bovee with Consumer Recovery Network.
Thanks for tuning into DebtBytes, our YouTube channel.
Today, I wanna talk about making good faith payments to
debt collectors, and some cautions, some warnings, why?
It's really just a collection ploy.
And what is, and if it's even a reasonable thing for you to do,
when would that be?
First off, collectors are pretty talented, they're skilled,
they're trained to try and
get you to make a payment of any kind, okay?
So sometimes they leave you the impression it's like, okay,
what we need from you today Mrs.
Jones is a good faith payment of X amount of dollars, okay?
It's a ploy.
If you don't have an agreement in place,
then that payment is not really going to go towards that
agreement, like you're negotiating a settlement.
Which we talk about extensively on our You Tube channel here.
Or, you're not engaging in some kind of payment plan or
payment arrangement, and this is the first of say,
three payments that's gonna resolve the account.
It's designed to get some kind of money from you.
And that's really what a collector's job is.
So, a good faith payment, if you make one,
is typically a bad idea and
something I caution you against because, how old is this debt?
For example, we have a video out about zombie debt.
And what I talk about there is how old a debt is matters,
how you deal with it, right?
So if a debt is too old for you to be sued
in your state because of your statute of limitations,
watch that video for more detail, then making a payment or
some kind of good-faith payment could re-age that statute.
And suddenly now, where you couldn't have been sued for
collection in the courts, you can, see?
So there's really good reasons to avoid these,
quote unquote, good faith payments.
Whose faith?
I mean, really if you wanna show an intent,
you're really negotiating, you're on the phone with them in
the first place coming up with some kind of,
or maybe you accidentally just picked up the phone and
you didn't realize it was a debt collector.
And that's how the conversation developed.
And then they started with their collection ploy
getting some kind of payment from you.
It's not important, honestly.
It's not anything for you to be overly concerned about whether
or not the collector gets money from you in that moment.
I certainly support your efforts to try and
negotiate some form of settlement or even payments when
it's the right thing to do, but on your terms, not on theirs.
I'm not a fan of good-faith payments.
There's times when you wanna get a mortgage, right,
and you're dealing with past collection accounts.
Your loan won't pass muster for
underwriting until you have either resolved unpaid
collection accounts that are still appearing on your credit,
or engaged in some kind of payment plan.
Well then,
that's a rare instance where we can start talking about okay,
the first payment being a good faith payment,
it's often referred to as such.
But it's actually part of a series of payments that you're
negotiating so that you can get your loan approved, right?
Those are the kind of instances where it makes sense.
It doesn't make a lot of sense in other ways, okay?
So don't get tricked or fooled by a debt collector and
I don't care if it's your original creditor,
cuz they use the same terminology.
Or a debt collector working for your creditor or a debt buyer.
Honestly even if you've been sued and
you're dealing with a judgment,
a good faith payment means little.
You don't the risk of renewing the statute of limitations since
you were already sued and have a judgment against you.
But it's really not conducive to you reaching your goals in
a negotiation or getting an affordable payment plan.
Let's talk about this.
Because if you have those kinds of issues where you're trying to
set up a settlement or some type of payment, long term,
short term payment arrangement,
post about it in the comments below, and get some feedback.
I want some details from you about your goals, or
engaging in conversation about good-faith payments is
either gonna work for or against you.
See you on the next video.
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