Making Monthly Payment Arrangements with a Bill Collector

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Paying off a debt collection is beneficial to your finances in most cases. Not only will you stop debt collection calls, but you also take care of an outstanding debt on your credit report, and improve your chances of getting approved for future credit cards and loans.

While you might want to pay off your collection, your current financial standing may make it difficult. Sometimes debt balances are simply too large to pay all at once. Instead, you may be able to split up the payments and pay off your collection account in installments by making a payment arrangement with the collection agency.

Setting Up Payment Arrangements with a Debt Collector

Accepting a payment arrangement is at the discretion of the debt collector. Whether the debt collector will accept a payment arrangement depends on the collection agency, the debt, the amount you're proposing to pay, and, sometimes the amount of time the collector has had the debt.


The more you can pay and the sooner you can pay off the debt, the more likely it is that the collector will accept your request for a payment arrangement. Collectors may be hesitant to accept a payment arrangement that spans more than a few months.

Debt collectors typically hold debts for about six months, so if you'll have more success making a payment arrangement in the first month or two after the collector contacts you, especially if you can pay off the account quickly. On the other hand, if you wait a few months before proposing a payment arrangement, the collector might refuse or push for a higher payment since it will be losing the account soon.

Payment Arrangements and the Statute of Limitations

Before making a payment, payment arrangement or even confirming the debt is yours, confirm the statute of limitations hasn't passed. This is the amount of time a debt is legally enforceable, which limits a debt collector's ability to sue you. This time limit varies by state and is usually between three and six years, but can be as long as 15 years.

Making a payment arrangement on a debt can can restart the statute of limitations on the debt, extending the amount of time the collector can sue you. Since you're interested in paying off the debt, you may not mind that the statute of limitations is restarting on a debt.


Making a payment arrangement does not restart the credit reporting time limit. This is seven years from the date of the account's delinquency, regardless of whether you may a payment or not.

Proposing a Payment Arrangement

Before suggesting a payment arrangement, make sure the debt is yours. You can write to the debt collector requesting proof of the amount you owe. If you're satisfied with the proof and you're ready to proceed, the next step is to figure out how much can pay.

Take time to review your budget and upcoming expenses to figure out how much you can afford to repay each month. Don't let the collector push you into paying more than you can afford to. Once you've reached an agreement with the debt collector, keep up with the payments as scheduled. If you miss a payment, collection actions can resume.

When the Collector Won't Accept

If the collector won't accept your payment arrangement, your options are more limited. You can save up enough money to pay off the debt in one lump sum. Start by putting aside money each month - as much as you would have paid if you had a payment arrangement - until you've saved up enough to pay the account in full. Keep in mind that in the meantime, the debt collector will continue its attempts to collect from you, which may include filing a lawsuit against you.

Paying off the account with a credit card, home equity loan, or a debt consolidation loan is another option, especially if it becomes urgent to take care of the balance. While you'll technically still have the debt, you'll have the option to make smaller monthly payments until you've paid off the account.

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The Balance uses only high-quality sources, including peer-reviewed studies, to support the facts within our articles. Read our editorial process to learn more about how we fact-check and keep our content accurate, reliable, and trustworthy.
  1. Federal Trade Commission. "Time-Barred Debt."

  2. Consumer Financial Protection Bureau. "What If I Believe I Do Not Owe the Debt or I Want More Information About the Debt?"

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