We recently had our neighborhood garage sale, and it occurred to me that I could use that opportunity to practice my negotiation skills with very little risk.
When negotiating, you need to have two things in mind:
1. What is your price (either as a buyer or as a seller)? Know your value and be confident about it. When dealing with a creditor, know your financial information, so you can be confident in the settlement offer to the creditor.
2. There is value in taking less or compromising - a value to "not put it back in the garage." When settling debt, there is a value to getting the creditor to go away, even if the creditor is asking for more than what you want to pay. What is the opportunity cost inherent in settlement? What is the emotional value to settle?