9 questions to ask before you reaffirm an old debt

Start with, 'Do I owe it?'

Thinking of reaffirming old debt? Take your time, act carefully and get everything in writing first. Otherwise, you risk making your situation worse.

Here are nine questions you need to ask:

1. Is the debt legit and is it even yours? Do you remember incurring the debt, and are you certain you never paid it? Has the statute of limitations run out (or is it about to run out)? And, if the debt is yours, is the balance similar to what it was when you stopped paying, or has it been inflated to an unreasonable (though perhaps legal) amount with fees and interest charges?

2. Does this company own the debt? If you're not paying your original creditor, can the collectors furnish some proof that they actually own the debt? Otherwise, this could be a scam attempt.

If the company calling or writing claims to be acting on behalf of the owner, contact that party directly, says John Rao, attorney for the National Consumer Law Center. Otherwise, you need to see something from the collector that shows they have the authority to settle the debt, he says.

3. Is the collector reporting the account accurately? Collectors are allowed to report the delinquent account to the credit bureaus for up to seven years after it was charged off or went to collections (usually seven years, six months after the debt first went delinquent). After that, it shouldn't be on your credit report at all.

If the debt is younger than that, then make sure the information is accurate. You have the most leverage regarding corrections before you pay, not after.


When a debt collector asserts that you should reaffirm a debt, ask the collector to put the following in writing on company letterhead:

  • The name of the original creditor.
  • The correct delinquency date.
  • Account number.
  • Balance.
  • The name of the collections agency that acquired the debt.
  • The acquiring date.
  • The balance and any terms (fees, APR, etc).
  • The exact language the collector will use to report the repaid debt.

That way, if any incorrect information later appears on your credit report, you have proof to show the credit bureaus.

4. Why do you want to pay the debt? Is your reason valid or based on misconceptions? Paying the debt will not erase it from your credit report. And if the company is threatening to sue, check out the state statute of limitations to find out if it even can. Or talk to an attorney. Many times, when the debt is small enough, it's not worth a collector's time and money to sue. (And a lawyer can give you a good idea of where that line may fall.) If you can't afford a lawyer, a phone consultation with an attorney affiliated with the National Association of Consumer Advocates  may cost little to nothing, says John Ventura, author of "The Credit Repair Handbook."

5. Are you getting a significant discount on the balance? If your debt has been bought by a third-party collector, it likely paid pennies on the dollar for your account. So any money the company gets from you is pure profit. Keep that in mind when you bargain.

6. Will the collector agree (in writing) that your payment satisfies the debt in full? Get this in writing (on letterhead), before you send a check. If they won't do it, the company could simply be trying to restart the clock on the statute of limitations for collections.

7. Can you afford it? Does reaffirmation fit your current financial priorities? "For the consumer who's barely able to provide for their family, settling the debt would seem ridiculous," says Rao.

Talk with an attorney and ask what assets could be at risk. If acknowledging the debt means the company could sue, get a judgment, and force the sale of your home or other assets, then it's not a smart move.

8. What language will the collector use to report the debt paid? Get that agreement in writing, too, before you pay.

Also, ask the original creditor if it's willing to amend its credit reporting, as well. You want that notation to read "paid in full," not "settled or "settled for full amount."

9. Can you document your arrangement with the collector? Send all communications to collections agencies and credit bureaus in writing, certified mail, and keep the green-card receipts that you receive in return, along with copies of your letters. Also save copies of the canceled checks that you used to pay off the account or make payments, plus all of the letters from the collection agency and credit bureaus.

See related: 6 reasons debtors are tempted to reaffirm debt, What is debt reaffirmation?, Statutes of limitations for credit card debt, State by state bankruptcy filings, Bankruptcies creeping upward as economy sours, 5 tips for those considering bankruptcy 

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Updated: 11-24-2017