I have an outstanding student loan through CIBC that is going on it's 5th year now.  For the past year I have been worked over by NCO Financial in every way imaginable.  It has been a nightmare and I finally wrote a letter of complaint to my MP and CIBC student loan center stating that if the harrassment did not cease I would take my documented complaint case to the media.

Anyway, I have recently had an acquaintance step up and offer to help me out.  My total loan with interest now comes to over $9,000 and this acquaintance has offered to put up $4000.00 to settle the loan.  I have no savings and very little that could be put toward payments at this time.  I have provided NCO financial details to substantiate this fact.  I have put forward the proposal to settle the entire debt for $4,000 and am waiting to hear back.  Is this a reasonable move on my part?  If they refuse the offer the money will not be given to me for payments and I will be starting from square one.

If the offer is accepted is there something that I can have added into the agreement that will help in repairing my credit (which is in dismal shape).  I recall hearing that upon settlement you can request a certain terminology that will give the credit report a cleaner look.

Any advice that could be provided would be greatly appreciated.

I have just spoken to them and they asked if I had any assetts(no) or any other outstanding loans (also no---I have already taken the bankruptcy route).  They then said that they will present my proposal to their client and if approved I would settle by wire payment.  I stated again that this would have to be a settlement in full of the entire debt and I was assured that I would receive proper documentation.

I don't know what to believe anymore and am nervous regardless of what I do.  If this could put an end to this whole nightmare it would feel like being released from a prison sentence.

Has anyone else had a similar experience in terms of offering a settlement?  Perhaps you could offer some advice on proceeding at this stage.  I am very much alone in this situation and fear being taken advantage of once again.  In the past I have dealt honestly and fairly with this company only to have any and all information provided to them used against me at a later date.

When sending in financial/expense details to NCO Financial is it safe to send a copy of one of my paycheques? 

If I am putting forward a proposal to settle (for less than the amount owed) and have already faxed them a copy of my emplyoment contract detailing my annual salary should this not suffice?

I am concerned that they are using the settlement proposal as a ploy to gather private details on me.  for example my employee number, HR department information and company address etc.?  During the same conversation they asked my offical title at work.  How is this relevant to a settlement?

If anyone has any advice on this I could use it ASAP.

Thanks

You need to get a document that states that X-amount is the total debt and inclusive; if they are settling then this is the final and inclusive amount.  If that amount is disputed later, you have the letter that states the amount in black and white.  Anything more they can go fish in the sea.  Then, when you pay it off, you have to badger them for the release of debt letter - that the debt has been paid in full and you are absolved.  Make sure they write that in.

But Withnail, I cannot strees this enough - DON'T SEND THEM ANY PERSONAL INFORMATION! What the foo are you sending them your paystubs for???? Don't.  They don't need that information except to harrass and snoop on you.  It is TOTALLY irrelevant to a settlement.  With them this information is completely insecure and you have no idea where it will end up.  Hunter is right. Just state your business firmly and see what they say. 

Take care.

But GET IT IN WRITING!!!!!!

Thanks for all the advice...I have contacted John and will hold off providing any information to NCO.

When I initially argued against providing any information like an expense list they said that they required justification that I could not afford to pay the entire amount when taking my proposal to CIBC.  This seemed reasonable to me.  However, I am fully aware of the tactics that these people use to gather information and am again becoming increasingly nervous.

If I tell them that I refuse to provide a copy of my paycheque it will likely be met with a hang up.  I want CIBC to at least hear my proposal.  when I tried to contact them directly they said all communication had to be done through NCO Financial.  It is like being caught in a trap.

I have played everything up front and honest....these people do not play by the same rules. 

I just spoke with John at the CFW Group and you are all correct!

He immediately collected the basic details of my case...directly called the representative who I have been dealing with and worked out where I stood.

I am still in the negotiation stage of the settlement but John's help and advice have taken an enormous weight off of my shoulders.  I feel like I am on the right path with some qualified, informed and honest backup.

What a bloody relief!

hi Withnail,

Quick FYI

I settled with NCO for 60% of my loan and I have a friend who got them down to half so I can tell you from personal experience they do become "somewhat more" flexible when you the concept of full repayment hits the table.

Regardless, they are still bad people.

Suggestion:

Remember that if they have no information on you and you've defaulted already, you are in the power position when working out a settlement. They would have sued already if they could have. They will be restricted by their client's guidelines, but bear in mind, if they think you'll just disappear like smoke in a breeze, they'll be inclined to take what they can get in a settlement rather than see the whole package go south.

So go ahead, offer a deal, work it out. But don't give them information!

dazed&confused wrote: How did you bring it up with the CA?  Did you just flat out offer? Or did they mention it to you?

I propsed the offer myself.  They never asked for anything less than payment in full...for a year and a half of negotiations.

Johnny sugessted I send my paycheque.  He said they need this as proof of salary to show CIBC why I am having to settle for a figure smaller than the amount owed.  I do not want them to have any details on me but his reasoning seems just.  There is also no information in particular on the paycheque that they couldn't find out themselves with a little searching on their part. 

Still unsure but forging ahead

withnail

good luck and keep us posted on how things go.   having johnny involved i am sure things will go smoothly for you.  i hope it works out for you - we need more success stories around here.

D&C

After sending in partial payments to NCO for four years, they started in on the whole "we cannot allow you to continue to give partial payments, we require resolution of this debt speech". The fact that I was giving them partial payments is probably important due to the fact that it shows an attempt to pay the loan. I found out at the time that the resolution speech was not entirely true but I did not tell them that fact.

I responded very nicely that of course I wished to resolve this issue but unfortunately I did not have the money to pay off the loan. NCO immediately responded with the "do you have any friends or family members that can loan you the money to pay off your loan". I responded that I did not but that I would continue with my partial payments.

They then came back at me with the "can you secure a loan at a bank in order to pay off the debt" question. My obvious response was that, due to the damage to my credit rating, I could not secure a loan. They then brought up the idea of a co-signer for the loan. This is when I stalled. For 3 months I kept telling them that I could not get a loan large enough to settle the account. All during this period I continued with the payments. As frustrating as this gets, never stop sending them monthly payments. They will use any stoppage of payment against you.

Then, like the hand of God parting the Red Sea, emerged the settlement offer. It goes something like this....."Mr/s insert name here, we have gone back to your creditor in order to discover if there is any room for compromise. Your creditor has agreed to settle the loan for insert percentage here. Can you secure a loan for that amount?" At first I was amazed. It was if my reality had somehow been altered. One minute they're calling my family (even though they had my number), threatening legal action, and doing everything except threatening to tar and feather me and run me down Bay Street, and then it's all about working together and compromising......

A couple of quick details:

1. As mentioned before on this site....get a letter in writing from your creditor, not the CA, before you send money.

2. Do not send a cheque or a money order. Arrange an appointment with the bank that gives you the loan. Sit in front of your loan officer. get the NCO rep (or whatever CA you're dealing with) on the speaker-phone, and have them do an electronic transfer. They can verify the transfer of funds almost immediately.

3. Get another letter from your creditor indicating that the monies have been received and that the loan has been paid in full.

CA's will infer that settlement offers are unique or special. Although I have no hard evidence to dispute that assertion, I find it hard to believe. I firmly believe that they have a pre-existing magic percentage from the banks. Do we honestly believe that the CA's go to the banks every time a settlement offer is discussed. Think of how much work that is and how much that would cut into their productive day of calling us 5 to 10 times every day. Obviously they want the money but the CA's main goal is to close the file. Closed files mean commissions. Secondly, the banks do not go to CA's to secure partial payments. They go to the CA's as a means to clear up the file. If the CA's can't close the files, they have to answer to their clients....the banks.

CA's want our files closed as much as we want them off our backs. If you're going to settle.....never tell them you have the full amount. They will settle. Just my opionion.

absolutely

once upon a time i had an account with eaton's.  then they went belly up the account was purchased by nrcs.  due to circumstances i fell behind and the account was shipped of to a CA.  of course they demanded payment in full, which i did not have.  after two weeks of phone conversations with a suprisingly pleasant CA ( who was leaving, she told me) she arranged a payout of roughly 30%, debt settled and paid in full letter sent by fax before payment received original followed one week after receiving my money order.

so there is always room for negotiation, just depends how flexible the lender is and how badly they want your money

Thanks Pigeon.

Yeah, I've been paying them off for About 7 years now.  They did offer me a settlement about two years ago, but as luck would have it, I could'nt do a sweet thing about it.  Now I'm coming into a position to settle,  but I want to get the best deal I can.  So I have to approach them carefully so that they don't get greedy.  I'm thinking Johnny will be my best bet.

Thanks for all the advice!

Interestingly just as I was reading Pigeon's  article I received a call (at work which is illegal as they have been informed in writing this is forbidden) that they will be sending in my proposal today for the original stated settlement amount. 

They did say however that CIBC is likely to turn it down and he expects them to ask for 55% of the total debt (less than the offer I made...and much more than I have).  NCO said they would put forward the proposal on the condition that I attempt to come up with the additional funds.  It is extremely unlikely that I will be able to do so as my original offer is already a personal loan and was very difficult in itself.

I will update you all as things progress.  It will likely be early next week (2 business days) when I get a response.

Hoping

55% is pretty good!  We'll keep our fingers crossed!

Withnail,

55% is a pretty decent deal Once again just my opinion but I would bet that 55% is your pre-approved settlement percentage. Given what we know of CA's, can you really see a representative of NCO calling the bank with the following conversation:

NCO: Hello bank representative, Withnail has proposed that s/he can pay off the loan for (whatever your proposal was). Is that OK?

Bank: NO NCO. That is not suitable. S/he must pay 55%!!

NCO: Shucks. Well, I thought I would give it a try. I'll have to call them back and give them the bad news.

Ten to one the banks have already told NCO that they will settle at 55% and NCO is already aware that 55% is the magic number. The reason banks send the files to CA's is so they don't have to bother with it. I would think that banks don't want to deal with CA's constantly calling them with proposals. It's far more probable that there is some standard settlement rule.

Regardless, best of luck and I hope it works out!!

PS: If we accept the fact that the banks have a standard settlement percentage (ie. 55%), what happens to the extra money when someone settles by paying more because the proposal never comes up?

Thanks Pigeon,

If NCO does in fact have a pre-set limit of 55% (which does seem to make sense)....does this mean that if my offer is declined and I cannot come up with the extra amount I will be starting the whole process over again with payment arguements????  Do you think there is room for negotiation beneath the 55% or is this a firm limit set by CIBC?

I spent three years in Europe hassle free.  If I have to continue the daily phone calls with these people I am really going to think about leaving again.  In the big picture the loan is such a small thing and yet it has managed to essentially destroy my life.

At this point I would recommend to anyone interested in gaining an education to avoid doing so unless they can pay for the tuition, living expenses, books and time off work up front (essentially this would be students with wealthy parents). 

God this has all made me bitter! 

 Withnail,

 I think you are safe with the offer you tabled. CIBC, nor any bank, likes to settle for less than 70% as a general figure. Everything depends on the individual's financial situation and chardship. The banks are willing to go lower providing it makes sense to do so.

 Remember, offering settlements just to save a buck will bring you less results. The traditional settlement acceptance from the colelction agency level is 65%-75% (depending on their client) to 75-85%. Usually, on balances over $5000.00, the agency only has blanket approval to accept 80-85%. Anything less has to be submitted for approval.

I finally settled the account on Friday.  NCO Financial agreed to a settlement offer a week earlier and wanting everything to go through smoothly after a year and a half of hell I directly requested John LeBlanc's help. He took over Power of Attorney and was provided a copy of the contract I received.  Even at this late stage in the game I am so happy to have had John on my side.  The rep at NCO in what can only be one last chance at a malicious blow called my wife with a wakeup call to bellow in her ear that he needed to speak to me immediately.  He knew I was at work and also knew that the POA didn't kick in for another two hours.  As well they had 'Without Prejudice' written on the contract.  Apparently this could have allowed them to back track once payment was received, renege on the contract and demand further payments.  This was my greatest fear as I had witnessed the tactics of these snakes first hand for such an extended period of time and was sure they had further tricks planned.  John had this removed after taking it up with the head of NCO Financial Ernie Wanchuck (?). 

In fact the dirtiest players in this whole experience were situated earlier on when my debt lay with the Edmonton Office.  The manager Michelle Holmes was by far the worst.  Daily and numerous phone calls to my home and work were her forte. Threats and phone hang-ups were her only method of communication.  She excelled at harassment.  Her sidekick Ron Hansen was not much better.  He started out friendly but ended up using any and all information that I provided him in good faith against me.  He taught me a valuable lesson in trust...one which I hope my children will never have to learn about the darker nature of the human spirit. All in all this company used the filthiest of tactics, often crossing legal lines in order to extract from me what I was trying to pay them anyway.  When the pressure became too severe I phoned my original contact at CIBC where the loan came from and was told that all communication had to be through NCO Financial.  During this entire ordeal my health and relationships have suffered.  I have been diagnosed with anti depressant and anti anxiety medication.  I haven’t had a good night’s sleep in well over a year. 

The assumption at NCO Financial in general is that everyone is trying to get out of paying their debts.  They are not open to the possibility that some people are truly struggling and are suffering to make payments.   In the end not only were their tactics not effective but were in fact counter productive.  

The amount that I settled for was less than the total debt and was put forward by an acquaintance to get me away from this organization.  I now have a payment plan established with this individual and can begin to rebuild my credit.  Best of all I am not living in the shadow of fear that this corporation cloaked me in. 

John LeBlanc entered the picture quite late for me and I only wish that I had come across him earlier.  His fee is miniscule compared to the relief that comes from having a man of his professional experience on your side who is quick to go to bat for you.  I really feel that he is one of those good people who understands the tricks of the less honourable and can play them and beat them at their own game.  He is also very good at helping to put many of the fears relating to this experience to rest.

I arrived back in my home and native land with my newly wife of new Canadian Citizenship with full intentions of settling this old debt. NCO Financial and the institutions that support and tolerate such establishments made me embarrassed to call this country home.  I had after all taken a loan to attend a Canadian School in an industry in which I would later work in and support the Canadian economy.  John LeBlanc as well as a few others helped me regain some dignity in the place I would like to continue to call home.  

I will be writing a thread on recommended advocates at a later time to explain John’s role in putting this debt to rest.

The "without prejudice" clause is really not a problem in such negotiations. It is standard in out of court settlements. It should always be used by any debtor proposing a deal. Basically the letter cannot be used against you unless you go to court and the judge imposes a settlement. Should that final settlement be similar to or less than the amount proposed in the "without prejudice" letter, it can then be produced to the judge and a penalty imposed against the person who turned it down. It cannot be used before the final verdict or if the final verdict was for a sum greater than that offered in the letter. The other reason for a debtor to use it in regular correspondence is that it cannot be used against you in court, it cannot be construed as an acknowledgment of the debt by the creditor in order to reset the statute of limitations.

 It is if the agency is issuing a letter trying to entice a settlement without permission to do so by their client.