Debt collectors have a job to do and for the most part, the reward for a job well done is a commission from every dollar collected. It is in the debt collector’s best interest to leave no stone unturned when it comes to getting money paid from those that have outstanding debts. For this reason, many debt collectors can become pretty aggressive and exceptionally resourceful when it comes to pursuing you for money owed.
Because of that very resourcefulness, stricter laws have been enacted by the government to police the tactics used by debt collectors. These changes in legislation have now made it against the law to pursue debts in a threatening manner and have set a standard of guidelines meant to protect the debtor from undue harassment. However, despite the laws, some debt collection agents are persistent enough to drive one slightly insane.
Repetitive calls at home, work, and on your cell can make you not want to answer the phone. Written correspondence can become a bit terrifying especially when you don’t have the money to fend off legal actions being threatened. Overall, debt collection can wreak havoc on a person’s life thanks to the efforts of the collector and the general feeling of guilt and being overwhelmed by your withstanding debts.
Here are some tips to survive the madness and options that you have when a debt collector is on your back:
The best recourse when being hounded by a debt collector is to know what exactly is going on and what your rights are in the situation. All consumers have rights under what is known as the Fair Debt Collection Practices Act (FDCPA). This is the laws that protect the debtor from being treated unfairly by those collecting on a debt. The best defense against any threat or accusation is to know what is and what is not allowed by law. Read the information from the Federal Trade Commission about unfair debt practices and get wise about the ways of consumer debt.
While the debt collector’s constant calls can be maddening, the only reason they continue to keep calling back is that you are not taking their calls in the first place. Sure, it can be intimidating to have a debt collector demand money you simply do not have access to, but it is time to end the charade and pick up the phone. Most debt collectors are happy that you are willing to participate in the resolution of your debts. The longer you avoid their calls, the more upset and un-agreeable they will likely be.
Ask for Proof
When debt collectors take over a debt from your original creditor, it can get quickly confusing as to who is legally allowed to take your money. For this reason, it is imperative that your first step when dealing with a debt collector is to ask them to verify the debt. This means they must be able to provide proof the debt is yours, how much the debt totals, and that they are able to legally collect on the debt. This is called ‘debt validation’ and it should be the first thing you discuss during your phone call. If the debt collector is unable to verify or provide proof, you will not legally need to pay the balance due. Also, debt collectors are required to stop contacting you until they have validated the debt.
Every debt collector will likely lead you to believe they have no power for negotiations. The reality is the debt collection agent will test the waters to see how far he can push you for money amounts. If they feel they can get the total amount due, they’ll keep pressing until you agree to pay in full. If you are generally under a financial hardship, the collector will typically be willing to work with you on a reasonable amount you can afford. While they may eventually agree to your terms, they certainly will put up a fight in the process. You need to be ready and willing to stand your ground and know exactly how much you can afford to pay out.
Get it In Writing
The only way your negotiation will be completely successful is if you get it in writing. If you agree to pay a certain amount towards the debt and the debt collector agrees to accept it as paid in full or settled for a lesser amount, you will need to secure a confirmation of these terms in writing. If you fail to get the details of negotiation agreed to formally, you may be at risk in the future for paying the remaining balance due without proof of your prior arrangement. Don’t make the full payment without a written confirmation. You can send a copy of a money order or a cashier’s check payable to the debt collection agency until you get the proof you need.
Get Money Under Control
The only way to avoid the insanity of dealing with debt collectors in the future is to refigure your finances to avoid debt cycles from happening again. You need to rework your budget so that you can eliminate the debts you have with current creditors to prevent them from being transferred to the more aggressive debt collection agents and to keep your credit history free from harmful negative information. Start living below your means or add additional income to your household to avoid getting in over your head again in the future.
Debt collectors are just doing their job and unless they are wrong about your responsibilities to a debt, you are the actual cause of the repeated contact. While many consumers struggle with debts they cannot pay due to financial hardship, the biggest lesson learned should be to move forward with better money management skills to eliminate existing debts and keep future finances on track.
This guest post was written by Eliza Collins, a seasoned personal finance writer with professional experience in the debt relief industry. Eliza writes at the debtsettlement.com blog where you can read more about hands-on debt relief strategies, debt relief services or credit repair.