Wednesday, April 10, 2013

This technique also works in my negotiations with prosecutors

So I have a student loan from law school that is extremely overdue. I know it's overdue but there isn't much I could do. I had other bills to pay before that one. My philosophy on bill paying since being on my own & not having enough money to pay everything is that things that can get taken away take priority and get paid first. So, rent, car payment/insurance, utilities, etc. come first. Then, things I need, like food & medications. Last, things that I owe money to but can't do anything but hurt my credit and eventually garnish my wages, meaning mostly student loans and credit cards. Usually those things just go unpaid because I run out of money. Don't get me wrong, it's not that I don't intend on paying them back eventually. I just can't do it right now.

So I have been talking by email with one of my loan companies. I explained the divorce/depression issues of the last year and a half and said I could pay $50/month for now to show I am not blowing it off. The response was: no, that would not work. The best he could do would be to grant me a forbearance that would bring my account current so it wouldn't default and then I would have to start paying the full amount due each month.

I responded that that wouldn't be possible right now, but that I would be able to start paying once I moved in July to a cheaper apartment, so could he get me a forbearance until then?

The response: no. He can only get me a forbearance to bring my account current, not for any future months.

I replied cheerfully (because I don't care that much about paying this off at the moment since they can't take anything from me) and said that that was too bad because I had really hoped we could work something out. It doesn't benefit either of us if it goes to collection, because garnishing my wages will only get them a max of 25% of my net income, spread out among all my creditors who would garnish my wages, which would be well below the amount he was saying I would have to pay. But, it sounded like their was nothing we could do to make this work, since I couldn't pay till July and he wouldn't extend a forbearance until then. Ooooooooh well! We tried! Thanks!!

The response: please call me.

So, we spoke on the phone today and he said, "Ok. You wore me down. I'll give you a forbearance until July. I don't do this for people whose accounts are this far overdue, but you're very persistent."

Yes! I win! I get my account brought out of overdue status, I get to postpone additional payments until July, AND I get a reduced payment amount when I start paying in July. Awesome all around!

I don't know that I have ever "worn down" a creditor before. But I use the same technique in some of my plea negotiations. Polite persistence until the other party just wants me to stop talking and they relent, just to make the whole thing go away.

Being annoying, FTW!!


  1. Anonymous7:57 PM

    In many ways, it might be more beneficial for you to pay off your student loans first, and then declare bankruptcy. That way, you've whittled down a secured loan, and then you can get the unsecured loans wiped out. In the end, you'll be free of both secured and unsecured debts.

  2. Anonymous12:33 AM

    Student loans don't discharge in bankruptcy, FYI.

  3. I'm not sure that I'd ever be able to actually pay off my student loans. Thank you, law school! I kind of just assume I'll be paying them off until I die. The only unsecured loans I have are 2 credit cards and then student loans. Everything else is secured, so I pay those first, since I don't want them to come take my stuff away. :)