Don't be afraid to negotiate with your landlord or a bill collector. Instead, think of negotiation as a tool you can use to keep your credit, your home and yourself out of trouble.
Some people say negotiation is an art—but it's not. Think of it as a tool, like a hammer. Anyone can use it to potentially get out of a bad situation, including debt, late bills or rent you have fallen behind on.
A negotiation is just a conversation. It's a discussion about what the other side needs from you and what you need from them.
That’s not to say negotiations should be taken lightly. Chances are there's a lot at stake, like your credit or your home. Here’s how to negotiate with courage, respect and confidence.
Don’t wait. Negotiate.
If you know you’re not going to be able to pay your rent at the beginning of next month, don’t wait until you have already missed the deadline to tell your landlord about it. The same goes for a bill you know is going to be late. Contact your landlord or the person you owe money to as soon as you know there’s going to be a problem.
Put yourself in their shoes
As you can imagine, landlords often care a lot about getting rent on time. But it can cost them even more money to lose or get rid of a tenant. The same goes for bill collectors. Their job is to get back as much money as possible.
If you can’t pay on time, that’s not likely to make a landlord or bill collector happy. But they might be willing to accept a payment plan, if that's all you can afford. Even better, maybe you can offer them something in return, like the promise of paying them back in full within a reasonable amount of time.
Let's say you owe your landlord $600 in unpaid rent. Offering to pay them an extra $50 a month, starting next month, might not get you very far in your negotiation. But offering them something more immediate could. For instance, you could offer them $300 now and then an extra $50 on top of your regular rent until you're paid in full.
Here's another example. If you’re trying to get out of your lease early, negotiate to buy your way out instead. For instance, tell your landlord that you're willing to give them your entire security deposit. Offer to let your landlord show the place anytime they want, without giving you the required notice. Or offer to pay your final month's rent upfront, if you can.
Allow some time to prepare
In the case of your landlord, don’t surprise them. Ask them politely to schedule a meeting or a call with you.
This will give you some time to do your own research and look at your own budget. You should also use this time to think through what you want to say. Rehearse it with someone you know or practice in front of the mirror. This can make a big difference.
Know your bottom line
If you are clear on what you want and what you can really afford, your negotiation will go much better. But it’s also important to be flexible.
Come up with an amount or schedule you feel comfortable with. Ask yourself, what would be the best result? What would be the worst result? The goal is to land somewhere in the middle.
Get it in writing
Once you and the other side have decided on a number, schedule or an amount of money you can both live with, get it down in writing. Sign it, and make sure the other side signs it, too.
Remember, it's just a conversation
Your landlord is human. Even the bill collector on the other side of the phone is human. As humans, we can all relate to the same fact: sometimes life doesn't go according to plan. If you are having a hard time with money, don't feel bad about it. Be honest about it. Often, people are willing to work something out with you, as long as it works out for them in the long run, too.