I could use some outside perspective on my situation.

I'm currently working full-time, while looking for one or two part-time jobs. I bring in $2,500 per month, and my monthly expenses are $2,300 per month. Admittedly, that's not as shoestringed or belt-cinched as possible, but it is restricted from what it's been in the past.

I'm trying to whittle down $8,200 in debt ($6,300 to one collection agency, $1,900 to a different collection agency for another credit card.) These are my only two debt sources.

I was thinking about working a debt snowball, paying off big chunks of the lesser debt while paying some on the larger. The thing is, I recently received a letter from one of the agencies saying they want their balance paid in only one, two, or three lump sum payments.

I flat-out cannot afford to pay 30% or 50% at a time, let alone the whole thing. I was planning/hoping to pay what would be closer to 10% per month. Are collection agencies flexible or reasonable at all? I was once told that they'll be happy to have anything, rather than nothing, (especially if I make two payments per month to show them consistency/sincerity) but is that true?

Any general ideas, opinions, and/or suggestions?

In my experience Collection agencies will bully you to within an inch of the law, and even break the law to try to collect on a debt. They will make threats, etc, but unless they have a court order, there is very little that they can do other than harrass you and try to scare you into paying.

If these are student loan debts, they can garnish your wages without taking you to court. Otherwise, they have to take you to court to force payment or seize bank accounts, as far as I know. I would tell them what you are going to pay them in good faith, and take it from there. If they don't like it, write to them and tell them not to communicate with your further except in writing.

you might want to check out

http://www.ftc.gov/bcp/edu/pubs/consume ... cre18.shtm

and www.consumerist.com for ideas

If you send them a check, they will cash it. Just tell them what you're going to give them and that's it. If they actually send back your checks, simply save up and pay them off. How old are these debts and how far behind are you?

That said, I don't know how your monthly expenses can be $2,300 when you bring in $2,500... that means you only have $200 a month to pay off your debt. Do you have any savings? If you have a $200+ emergency you will go into debt even more.

Part time jobs are nice, but I think the easiest way to increase your cashflow is to stop spending so much. Do you pay child support? Are you married and supporting your wife and kids? Do you track your spending? Getting another job would be a much larger hit to your lifestyle than just cutting back on spending.

Don't pay collection agencies, by that stage your credit is already ruined. You'd be better off putting that money in the bank and changing your phone number.

Why didn't I think of that.

If you do this be prepared to have it ruining your credit for the rest of your life. The debt can be re-sold every few years so that it never ages past the point of permanent write off from the reference of the credit agencies. It was already stated to just pay what you can and don't be bullied by their threats.

If you make a debt ,and it is a fair debt ,then you should make every effort to pay it. Cut expenses,if you smoke,quit. If you spend money on movies,stay home,if you are single ,live like a hermit until you pay the debt,cut expense and try to get a second job and apply it all to debt,you will feel better in the long run paying back what you owe.

Dave Ramsey takes calls similar to this all the time. His advice is to communicate to them via certified mail how much you are going to pay, and that they may only communicate to you via mail (if I remember correctly). I think I remember there being some various form letters online to get your point across. And from there, pay what you can pay until it is paid off. Cut back your expenses ASAP.

Yeah, like I said, I'm not 100% super-strict (still do some "frivolous" spending on the weekends with the girlfriend), but I've reeled it in from what it was. I do need to get gazelle-intense, as Ramsey would say, and further curb the spending. i think I could wrangle another $300-400/month. The part-time job was/is intended to further supplement the income and increase available funds to put towards the debt, to get it done faster.

I did recently (first deposit was this month) start an ING Direct saving account, to pay myself first and have something going towards savings. I have no credit cards, only one debit card, and rely on a cash budget (using the envelope system) for the rest.

The part about just not paying the collection agencies... yeah, um, that's kinda how I got into this trouble to begin with. I was a dopey youngster, tapped out my credit cards, and then considered them "optional payments" in the very back of my mind. Ha, man-o-man, young people are stupid.

I want to get this stuff done and over with, so I'll do as was suggested and communicate with them, via letter only, and send my checks on a regular basis in workable amounts.

Thanks gang.

I find that if you're communicating with the agencies and actually making an effort to pay down the debt they'll be somewhat flexible with you. As a couple people have pointed out your credit rating is probably shot at this point but is there any way you might be able to consolidate these two loans into a single one to make your life easier?

Also do you have anything that you can sell to put bigger lump sum payments?

Just think if you manage to cut back and put an additional 400 towards your debt then you'll be pretty close to paying the whole debt off in a year. By getting a second part time job you might be able to do it sooner.

I second this advice. Clean it up quickly and move on. OP, If you need something to do when you are not working, to keep you from spending money, read personal finance books. It works for me. I get them cheap at Goodwill.

I would add to do alot of research, know the law, know the rules, know the unwritten rules. Collection agencies in America are nasty scum of the earth creatures who work on fear and ignorance. Catch them breaking the law and enjoy the feeling of them pissing there pants when they realize that you know the law and will take them to court. I've read many stories of people spending years trying to get phantom debts removed, they pay the debt off, it gets resold several times and suddenly there credit is toast.

In America knowledge is power.

what are your expenses?