Settlements and Payoffs - The Basics - Why Offer or Accept An Offer
A settlement offer, driven either by the person who owes the money or by the lender, is a contract. It is not a gentleman's agreement, a spur of the moment idea, or an offer from a collections agent with no morals.
If you are the borrower there are many reasons for trying to settle an account for less than the full balance due.
Perhaps a job change, layoff, health issue, or divorce is the main factor. When the intent is honest and your financial situation has changed as settlement, while you still have some money, is better than bankruptcy, a garnishment, or breach of contract suit.
If the bank or finance company respects your position and honesty negotiations might begin. If the bank or finance company contacts you about a settlement for less than the full balance owed please stop to ask "why". Then go to our home page to see the steps to a valid settlement offer
