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How to Settle a Debt in Massachusetts

Sarah Edwards | July 26, 2023

Edited by Hannah Locklear

Summary: Settling unpaid debt in Massachusetts is entirely possible and can save you lots of money in interest and on the outstanding balance of your debt. To settle a debt in Massachusetts, you must first respond to any debt lawsuits with an Answer, then send a settlement offer, and get the agreement in writing once a settlement is reached. You can settle your Massachusetts debt on your own with SoloSettle.

Being in debt is never a good time. When debt collectors come knocking, it only makes matters worse.

If you’re shelling out money toward paying off a debt, you may not see much reward for your efforts — especially with high interest rates involved. If you can’t keep up with your payments or stop making them altogether, you may be taken to court for the matter.

Luckily, you can reach out to your creditor or debt collectors at any stage of the debt lawsuit process to and settle your debt. In most cases, consumers are able to settle a debt for 50% of the original debt value, saving them money and stress.

Think of it like ripping off a bandaid: you offer a lump-sum payment to a creditor or collector to settle your debt, and you can finally move on with your life. Below, we’ve prepared a helpful guide for people seeking to settle a debt in Massachusetts.

Let’s get right to it.

Follow these 3 steps to settle your debt in Massachusetts

  1. Respond to your debt lawsuit with an Answer.
  2. Make your initial debt settlement offer.
  3. Get the settlement agreement in writing.

You can reach a debt settlement with your creditor or debt collector in California on your own with SoloSettle and avoid having to hire a debt settlement company.

Now, let’s break down each step in detail. Don’t like reading? Check out this video instead:

1. Respond to your debt lawsuit with an Answer

If you’re being sued for a debt in Massachusetts, you have 20 days to respond before you automatically lose by default judgment.

You can reach out to a creditor or debt collector at any stage of the debt lawsuit process to discuss settling the debt. However, it’s in your best interest to avoid a judgment from a debt lawsuit. A judgment will allow the party suing you to pursue further collections activities against you, including garnishing your wages, seizing your property, or freezing your bank account.

A debt lawsuit begins when a creditor or debt collectors files a Summons and Complaint against you. These are court documents that 1) notify you of the lawsuit and 2) list all the specific allegations against you.

Like we said, you have 20 days to respond to a Massachusetts debt lawsuit. You respond by filing a written Answer into the case and sending a copy of it to the opposing lawyer.

In your Answer, you can dispute any aspects of the Complaint that are not accurate. For instance, you could say that the debt collector doesn’t have a relationship with you or that the amount they’re suing you for is incorrect.

While it’s better to settle the debt before your court date, filing an Answer prevents the court from granting a default judgment against you if your efforts fail. The judge will have to review the information you provide them and consider your arguments before granting a decision for you or the party suing you.

To learn more about how to respond to a debt lawsuit in Massachusetts, click here.

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2. Make your initial debt settlement offer

To kick off your debt settlement efforts, decide how much you can afford to pay toward settling the obligation. Consider how much money you have available and how much you can save before the court date. If you're short on funds, try asking a trusted family member or friend for help.

It’s advisable to start with at least 60% of the value of the debt when negotiating with your creditor or debt collector. An offer for 60% of the debt’s value tells them you’re serious about settling but also provides you with some savings on the total you owe.

If you can’t afford to pay 60% of the debt’s value, offer what you can afford to pay. You might consider explaining your personal situation and describing why you can’t repay the debt. For example, you may have lost your job or had a personal emergency that set you back financially. Some creditors and debt collectors will provide extra leeway if they understand you’re going through tough financial times.

Ultimately, the amount you settle on depends on the answer to a variety of questions:

  • Is it a signed promissory note or book account?
  • Is there a meritorious defense?
  • Are there any offsets?
  • Is it interest bearing?
  • Is there a valid fee-shifting provision? A fee-shifting provision requires the borrower to pay the cost of collection.
  • When was the last payment?
  • Is the debt owned by the original creditor or has it been assigned to someone else?
  • Is it part of a federal or state loan program or is it a private loan?
  • Is it secured credit?
  • Is it dischargeable in bankruptcy? Is it a student loan?

Knowing the answers to these questions will give you a better gauge on where to start with your negotiations. Here’s a little idea of what you could say in your initial offer:

“I see you’re suing me for [$1,000] for [case number]. I don’t have that kind of money, and I don’t agree with the amount. But I do have [$500] that I can pay within 30 days to settle the debt in full. Let me know if you accept.”

You’ll likely go through a few rounds of negotiation with the creditor, so try to be patient in the process. Remember, your ultimate goal is to settle the debt and avoid a judgment; keeping a cool head can help prevent your negotiations from getting out of hand.

SoloSettle’s software takes care of the negotiation process for you.

3. Get the settlement agreement in writing

Once you reach a settlement agreement with your creditor, get it in writing. A written contract protects you from further collections activity from the creditor. You'll fulfill the terms when you pay the amount due according to the agreement, and the creditor should dismiss their lawsuit.

Here’s a debt settlement agreement example.

Generally, the creditor or collector will draft the agreement for you, so just be sure to review it carefully before signing. Keep in mind that settlement agreements will also vary depending on what state you live in.

This agreement requires both sides to sign it in the presence of a notary. A notary provides an additional layer of protection, ensuring that there is a witness to the contract.

Now, let’s look at an example.

Example: Billy is being sued by Midland Credit Management for a $3,000 debt. He uses SoloSuit to draft and file an Answer to the lawsuit. Then, after considering his finances and budget, Billy sends a settlement offer via SoloSettle to Midland Credit for $1,700. After a few rounds of negotiations, Billy reaches a settlement of $2,250 (only 70% of the original debt amount). He is able to save some money and also move on from the debt.

Let SoloSettle manage your debt settlement agreement for you.

What are the debt settlement and debt collection laws in Massachusetts?

Massachusetts follows the federal debt collection laws set in place by the Fair Debt Collections Practices Act (FDCPA). The FDCPA limits certain activities by debt collectors and creditors. In particular, debt collectors cannot:

  • Call you at odd hours, like before 8 a.m. and after 9 p.m.
  • Use threatening language to attempt to collect a debt.
  • Harass you, such as by repeatedly calling throughout the day.
  • Discuss your debts with anyone other than you.

Massachusetts has also enacted the Massachusetts Consumer Privacy Act (940 CMR). This act grants additional protections from debt collectors. Collection agents cannot:

  • Call you someplace other than your home (such as your workplace) more than twice per month.
  • Call your house more than twice in seven days concerning a debt.
  • Make deceptive statements to get you to pay the debt.
  • Collect more from a debt than you actually owe.

While the Massachusetts Consumer Privacy Act goes further than the FDCPA in limiting collections activities, it allows debt collectors to contact people who may know you to find your whereabouts. However, collectors cannot reveal that you owe them money.

Under Mass. Gen. Laws ch. 260 § 2, creditors and debt collectors have up to six years to pursue legal action against consumers for debt. If your debt has passed this statute of limitations, the creditor cannot pursue a lawsuit against you. However, they can still try to collect the debt through other means.

What are the best debt settlement companies in Massachusetts?

You can be the judge of that.

Each debt settlement company has its perks and drawbacks. Beware that some debt settlement companies are actually scams and can make your situation even more miserable.

Many consumers prefer SoloSettle over traditional debt settlement companies for a few reasons:

  • Many debt settlement companies require your debt to be at least $15K or more to enroll. SoloSettle does not have a debt amount requirement like other debt settlement companies. You can settle debts of any size with SoloSettle.
  • Most debt settlement companies take a passive role in the debt settlement negotiation process, often waiting for offers to come to them. SoloSettle actively attempts to settle your debt.
  • SoloSettle is offered by SoloSuit, a trusted brand and a legitimate company. Many traditional debt settlement companies are actual scams.
  • SoloSettle handles all your debt settlement payments for you so you can protect your financial information from sketchy debt collectors.
  • SoloSettle has legal defense built in with SoloSuit. While settling, you can use SoloSuit to block lawsuits if you need. Most debt settlement companies don’t provide legal defense; if you’re sued for a debt you are on your own.

Below are some other debt settlement companies you can consider:

New Era Debt Solutions

New Era Debt Solutions is one of the older debt settlement companies. Initially founded in 1999, the company offers traditional debt settlement services. Essentially, you turn over your overdue accounts to New Era Debt Solutions, who attempt to negotiate a settlement for you.

With New Era, you’ll make regular monthly payments into an account. Once you have set aside enough money, the team at New Era will begin negotiating with your creditors one by one. Most people complete their programs with New Era within two to four years.

National Debt Relief

National Debt Relief is similar to New Era Debt Solutions. You’ll make monthly payments, and National Debt Relief will negotiate settlements with your creditors. Most people take two to four years to complete the program.

Like many other debt settlement companies, National Debt Relief charges its clients between 15% and 25% of their total outstanding debt for its services.

How do I contact my creditor to begin settling my debts?

Most creditors have three potential contact methods: phone, email, and mail.

We recommend conducting your negotiations via email so that you have a written record of the conversation. However, you can also attempt to negotiate a settlement over the phone if you feel more comfortable speaking directly with the creditor or debt collector.

Communicating via mail is only advisable if you’re not in danger of an immediate lawsuit.

If you decide to negotiate your settlement over the phone, you should ask your debt collector if you can record the call. Massachusetts does not allow individuals to record a phone call unless all parties consent under MA Gen L Ch 272 § 99.

If your debt collector doesn’t grant you permission to record the call, stick with email or mail to avoid potential legal penalties. Whatever you do, make sure to record all conversations with creditors and debt collectors.


Do you still have some burning questions about debt settlement in Massachusetts? We can help. Here are a few of the most common questions.

Q. What percent should I offer in debt settlement?

Deciding how much to offer in debt settlement is primarily up to you. The more you offer in a settlement, the more likely your creditor will accept an agreement. However, you are likely unable to repay the debt in full.

Consider starting with an amount of 50% to 60% of the debt. That’s enough to bend your creditor’s ear. They'll likely counteroffer if they don’t believe it’s enough to settle your account.

Q. How long before a debt is uncollectible in Massachusetts?

A validated debt will remain collectible in Massachusetts until you either repay it or settle it. However, after six years, your creditor can no longer pursue you for the debt in court. They can continue to call you and send you letters, but their attempts at collections may decline as time goes by.

Q. Is it better to settle a debt in Massachusetts or go to court?

Ideally, you’ll want to settle your debt with your creditor before going to court. That way, you avoid a potential judgment against you for the total amount of the debt. If you go to court, you should prepare by filing an Answer, including any additional evidence you have for the case.

How to get debt relief in Massachusetts

If you have additional questions about your debts as a resident of Massachusetts, we have answers. Read through our other articles for extra help with your obligations:

Settling a debt in Massachusetts takes effort, but it can be successful

When you’re in debt in Massachusetts, it’s hard to save money and develop good financial habits. Settling your debts can provide a path to starting fresh, whether you try to navigate the process on your own or with help.

SoloSettle’s goal is to empower you to negotiate and reach a debt settlement on your own. Check out this review from a real SoloSettle customer:

“I'm very thankful for SoloSettle.. Having a third party negotiate the settlement was instrumental in resolving this case and saved me from two giant headaches: 1) I didn't have to deal with the plaintiff's lawyer and 2) I didn't have to go to court. I also love that the payment was processed through SoloSettle. I was nervous about sharing my personal financial data with the other side, but SoloSettle protected that for me. I hope I never get sued again, but if I do, I would use SoloSettle again in a heartbeat.

SoloSettle really saved me a ton of time and heartburn and kept me from having to be my own lawyer in court.”

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You can use SoloSuit to respond to a debt lawsuit, to send letters to collectors, and even to settle a debt.

SoloSuit's Answer service is a step-by-step web-app that asks you all the necessary questions to complete your Answer. Upon completion, we'll have an attorney review your document and we'll file it for you.

>>Read the FastCompany article: Debt Lawsuits Are Complicated: This Website Makes Them Simpler To Navigate

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