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How to Settle Debt with Portfolio Recovery

Sarah Edwards | March 20, 2025

Sarah Edwards
Legal Expert
Sarah Edwards, BS

Sarah Edwards is a professional researcher and writer specializing in legal content. An Emerson College alumna, she holds a Bachelor of Science in Communication from the prestigious Boston institution.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: If you’ve been sued by Portfolio Recovery Associates (also known as PRA Group, Inc.) for a debt, you can settle before your court date and save a significant sum. To reach a debt settlement agreement with Portfolio Recovery Associates, follow these steps: respond to the lawsuit, send a settlement offer, get the agreement in writing. SoloSettle helps by managing the settlement negotiation and payment process for you.

If you’ve recently received a letter from Portfolio Recovery Associates, LLC, you may wonder who the company is. This letter probably means that you owe money for an unpaid debt with an old creditor. Since you likely never heard of Portfolio Recovery Associates before receiving the letter, why would you owe this company money?

Portfolio Recovery Associates is a legitimate debt collector that purchases overdue consumer and business debts, including credit cards, medical debt, and other types of loans. Currently, Portfolio Recovery Associates has an A+ rating from the Better Business Bureau.

Once Portfolio Recovery Associates receives your account from a creditor, it will begin contacting you to try and set up a payment arrangement. If one of your prior creditors sells your account to Portfolio Recovery Associates, you’ll want to take action to prevent matters from getting worse.

Sued by Portfolio Recovery? Respond and settle your debt before the court date.

Do not ignore communication from Portfolio Recovery Associates

It’s best not to ignore communications from debt collectors. When you first receive a notice that Portfolio Recovery Associates is seeking to recover money from you, ask for a validation of the debt. Under federal regulations, you have up to 30 days to request that Portfolio Recovery provides the information that confirms you owe the debt.

Validating the debt confirms that the company has full ownership over the amount owed. You can request a formal debt validation by sending a debt validation letter. When writing your letter, include the following:

  • A request to notify the credit bureaus that you dispute the debt
  • Proof you owe the debt, such as copies of contracts or account statements
  • Approximate age of the debt and the last action you took on the account
  • Debt collector’s license number
  • Determination of whether the statute of limitations expired

Should I pay Portfolio Recovery Associates if I owe the debt?

If Portfolio Recovery Associates is able to validate that you in fact owe the debt, then you have several options to consider. For example, you could establish a payment arrangement with the company, offer to settle the debt, or ignore the communication.

Under a payment arrangement, you agree to make regular payments to Portfolio Recovery until you pay off the obligation. In some cases, Portfolio Recovery may reduce the balance you owe by a certain percentage, allowing you to repay the debt more quickly. Depending on the amount you owe, it may take a few months to a few years to pay off the balance.

You can also attempt to settle the debt for a one-time payment. Under a debt collection settlement agreement, you offer a certain percentage of the total value of the debt, typically less than half of your obligation. In exchange for your payment, Portfolio Recovery Associates agrees to free you from the remainder of your debt and will stop further collections activity.

Settling the debt allows you to pay less than what you owe while preventing further negative impacts on your credit report.

Ignoring communications from Portfolio Recovery Associates is not recommended since it does nothing to actually resolve the debt matter. Failing to respond will also increase the likelihood that the company will escalate the matter to a debt collection lawsuit.

Portfolio Recovery Associates is suing me to collect on a debt. Can I still settle?

Yes, even if Portfolio Recovery Associates initiates a debt collection lawsuit against you, the option to negotiate a settlement remains on the table. Follow these specific steps:

  1. Respond to the lawsuit with an Answer before your state’s deadline.
  2. Send a settlement offer to kick off negotiations.
  3. Get the debt settlement agreement in writing.

Let’s take a closer look at each step and learn more about how to settle debt. Check out this video for debt collection negotiation tips straight from a former debt collector:

1. Respond to the debt collection lawsuit filed by Portfolio Recovery Associates

Your first step should be filing an Answer to the debt collection lawsuit filed by PRA Group, Inc. An Answer is effectively your formal explanation of your side of the story and directly replies to the points listed in the Complaint (known as a Petition in some states). Depending on your circumstances, you can deny responsibility for the debt, argue the amount owed, or contest its jurisdiction.

Even if you intend to try to settle the debt before your court date, filing an Answer prevents Portfolio Recovery Associates from obtaining a default judgment against you.

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2. Send a debt settlement offer

Next, decide how much you can offer for a debt settlement. Review your financial situation and decide on a reasonable offer. Take your living expenses into consideration and how much you could reasonably pay toward settling the debt in a lump sum. Usually, 60% of the obligation is a good starting point. Remember that the other option is paying the total amount—a settlement can prevent this.

If the debt collection matter has escalated to a lawsuit, you'll likely work with someone in the legal department of Portfolio Recovery Associates to reach a settlement. At this point, there's a much better chance you'll be able to negotiate a lower settlement..

In many cases, Portfolio Recovery would rather settle than move forward with a long, expensive, legal battle.

Start by sending a debt settlement offer to Portfolio Recovery Associates, giving yourself room to negotiate and settle for more if they don’t accept it. You can use the following prompt:

“I am offering Portfolio Recovery a lump-sum payment of $___ to settle the debt with case number ___. You can accept or counteroffer. If you accept, respond to this message with only ‘Accept.’ If you want to counteroffer, respond to this message with only ‘Counteroffer: $____.’ Please do not contact me in any way other than by responding to this email. I’m prepared to litigate this matter and win in court. I’m also prepared to file an FDCPA complaint. This offer expires in 6 days on MM/DD/YY. I will pay the agreed amount within 90 days of the settlement date.”

Wait to hear back from a representative with Portfolio Recovery Associates. Do not be surprised if they decline your opening offer. Since these are negotiations, you should be ready to engage in a back-and-forth with PRA Group, Inc.

It is also recommended to be transparent and open with the debt collector. For example, if your finances are limited, explain your situation. Sometimes, debt collectors like Portfolio Recovery Associates will grant you additional room for savings if they understand your current financial hardships. In addition, Portfolio Recovery Associates is known for being flexible and willing to work with consumers to reach a resolution outside of court, as opposed to going through a protracted legal battle.

3. Get the debt settlement agreement in writing

Once you have a debt settlement agreement in place with Portfolio Recovery Associates, get it in writing. This is important because a written contract that includes terms that indicate your settlement satisfies your remaining balance, can help prevent you from being subject to future debt collection activities on the delinquent account. Abide by the terms of the agreement and make your payment within the appropriate time frame.

If you’re uncertain of the debt settlement process and want some qualified help settling your account with Portfolio Recovery, SoloSettle can help you navigate the debt settlement process from start to finish.

Now, let’s look at an example of how to settle a debt with Portfolio Recovery Associates.

Example: Terry is being sued by Portfolio Recovery Associates for $5,000. He uses SoloSuit to respond to the lawsuit, giving himself time to work out a settlement plan without having to worry about losing by default judgment. After taking a close look at his finances, he decides he can afford to pay off as much as $4,000 (or 80%) to settle the debt. Terry uses SoloSettle to send a settlement offer, starting low at $2,500 (50%). After several rounds of negotiations, Portfolio Recovery agrees to settle the debt for $3,500 which is only 70% of the original debt amount. Terry saves himself some money and feels ready to start over with his finances and credit.


Use SoloSettle to settle your debt with Portfolio Recovery Associates

SoloSettle aims to empower you to negotiate and reach a debt settlement on your own. It’s a settlement negotiation platform that helps you send and receive offers from collectors. It will draft offers for you and protect you from the potential lies and bullying of debt collectors. Most importantly, SoloSettle makes sure all of the proper legal language is included to protect your rights when communicating with the creditor or debt collector.

When a settlement agreement is reached, SoloSettle manages the settlement agreement documentation for you and protects your sensitive financial information.

The proof is in the pudding. 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.”

No matter where you find yourself in the debt collection process, Solo is here to help you resolve your debt.

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

>>Read the NPR story on SoloSuit. (We can help you in all 50 states.)

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