It’s no secret that the debt collection agencies are full of controversy and headaches for consumers struggling with debt. According to a new report released by the Association of Credit and Collection Professionals (ACA), debt collection agencies recovered $55 billion in debt owed to creditors during 2010. The good news is that there are laws to protect those being sought after by this usually ruthless industry.
Knowing how to protect yourself and what the collection agencies limitations are can keep you from losing your cool and maybe even put you in a position to pay back your debt in a way that works for you, your family and your budget.
7 Tips for Dealing with Collection Agencies
- Don’t ignore the issue. If you receive correspondence from a collection agency, respond as soon as you are able. By ignoring the debt or correspondence from the collection agency you may be imposed with additional fees, possible court proceedings and damage to your credit report. Make it clear you acknowledge the debt and would like to work something out.
- Get it in writing. Without a paper trail it turns into a battle of he said she said. Be sure to include a record of all conversations, agreements and payments. Send communications via certified mail, return receipt requested; this provides proof you sent the document and proof that the collection agency received it.
- Log the calls. Keep a record of the day, time, and name of the collection agent, collection agency and a brief overview of the call.
- Don’t fly off the handle. It can be difficult to have a calm conversation when either party is being combative. Keep your cool, speak calmly, and if things are getting out of hand politely let them know you will follow up with a letter
- If you don’t think you owe it, dispute it. No one should have to pay for a debt they don’t owe. Request, in writing that the collection agency provide proof of the debt they are trying to collect..
- Only agree to pay what you can afford. Do not agree to pay what they are offering if you know you won’t be able to make the payments. Instead come to an agreement you know you can commit too.
- Getting sued. In the event a collection agency takes you to court over the debt be sure to respond to the court either personally or through an attorney. Bring all documentation including your notes with you. If you do not respond to the court notice the collection agency can obtain a default judgment against you. This judgment can allow them to garnish wages and freeze bank accounts.
For a full review of all of your rights when it comes to dealing with debt collectors you can visit the Federal Trade Commission’s website.
Debt collectors are generally seasoned professionals and they may try a variety of tactics to get you to pay. Don’t be intimidated into agreeing to payment arrangements that you can’t afford. If you can’t afford to pay your debt, seek your own professional debt help. The laws are there to protect you and there are multiple options available to help resolve your debt.
What is the stickiest situation a debt collector put you in?
Suzanne is a certified credit counselor and a Social Media Specialist for CareOne Debt Relief Services. Suzanne writes for Divorce, Debt and Finances and A Straight Talk on Debt. Follow Suzanne on Twitter @SuzanneCramer1 and @AskCareOne where she shares her insights on divorce and managing your finances.