Debt can happen to even the most financially responsible people. Most people are just one unexpected expense away from being in debt. A large medical bill or home repair, and suddenly, all of your financial planning can go out the window. This is not a fun experience. It often comes with feelings of stress and anxiety. These feelings get even worse when debt collectors start calling. Every time your phone rings, you’ll be filled with dread, worried that it is another person demanding that you pay your debt. This is no way to live. Let’s take a look at what you should do when debt collectors start calling.
Don’t Ignore the Calls or Letters
First things first, do not simply ignore the calls or any letters they send you. This is actually quite a common reaction. People want to ignore the problem and pretend everything is fine, hoping that the collectors will eventually give up. They will not. Collection activity will simply continue or potentially escalate. Furthermore, your debt will likely increase due to interest. Instead, you should open all correspondence from debt collectors. This will allow you to determine exactly what the debt is from and how much you owe.
Verify the Debt
Debt collectors are not infallible. They can, and do, make mistakes. Before getting worried or attempting to pay the debt, you should verify it. First, confirm that the debt actually belongs to you. Check for identity theft, mistaken identity, or accounts that have been incorrectly attributed to you. Next, review the amount owed. Check whether the amount claimed appears accurate, and compare collection notices with your own records when possible. Finally, ask for information about the debt. Under federal law, debt collectors generally must provide certain information about a debt and consumers have rights concerning disputes.
Understand Your Rights When Dealing With Debt Collectors
Just because you owe a debt, does not mean collectors can harass you. The main law protecting your rights is the Fair Debt Collection Practices Act. This law sets certain rules in place that debt collectors must follow, including:
● No calls before 8:00 a.m. or after 9:00 p.m. local time.
● No calling your job if you notify them that it is not allowed.
● No profanity, threats of violence, or repeat calls meant to annoy.
● No lying about the debt amount or pretending to be law enforcement/attorney.
● No telling your coworkers, family, or friends about your debt.
If a debt collector fails to follow these rules, you are able to sue them for damages in a court of law.
Keep Records of Collection Activity
You should also keep records of all collection activity. This includes:
● Saving letters and notices.
● Keeping copies of written disputes and responses.
● Recording dates and general details of phone calls.
● Preserving documentation relating to payments or settlement discussions.
Organized records can be useful if a dispute develops or legal assistance becomes necessary.
Consider Your Options for Addressing the Debt
Finally, you need to consider your options for addressing the debt. There are a few ways to go about this. First, you can pay the debt in full. This is the easiest and quickest way to deal with debt. However, it is not viable for most people, as it considers having a large amount of money available.
You can also try negotiating a settlement. Debt collectors are actually quite willing to negotiate. If you contact them and explain that you cannot pay the entire debt, they may agree to take a lesser amount. Make sure to get any settlement agreement in writing before making a payment based on the agreement.
The final option is bankruptcy. Many people are scared of this option, but it is actually quite a useful tool. You can declare Chapter 7 or Chapter 13 bankruptcy. Either of these will take care of your debt. If you do choose to go the bankruptcy route, it is wise to obtain legal help. Any legal help you hire should be local to your area to ensure that they understand your local laws. For example, if you live in York County, Pennsylvania, you should find a York bankruptcy lawyer to help you.
Take Action
The most important thing to keep in mind is that you have to take action. If you ignore the debt, it will grow and grow. Not only that, but collectors may take legal action against you, which can lead to liens on property or wage garnishment. You need to make a plan and begin addressing your debt as soon as possible.
Debt can happen to even the most financially responsible people. Most people are just one unexpected expense away from being in debt. A large medical bill or home repair, and suddenly, all of your financial planning can go out the window. This is not a fun experience. It often comes with feelings of stress and anxiety. These feelings get even worse when debt collectors start calling. Every time your phone rings, you’ll be filled with dread, worried that it is another person demanding that you pay your debt. This is no way to live. Let’s take a look at what you should do when debt collectors start calling.
Don’t Ignore the Calls or Letters
First things first, do not simply ignore the calls or any letters they send you. This is actually quite a common reaction. People want to ignore the problem and pretend everything is fine, hoping that the collectors will eventually give up. They will not. Collection activity will simply continue or potentially escalate. Furthermore, your debt will likely increase due to interest. Instead, you should open all correspondence from debt collectors. This will allow you to determine exactly what the debt is from and how much you owe.
Verify the Debt
Debt collectors are not infallible. They can, and do, make mistakes. Before getting worried or attempting to pay the debt, you should verify it. First, confirm that the debt actually belongs to you. Check for identity theft, mistaken identity, or accounts that have been incorrectly attributed to you. Next, review the amount owed. Check whether the amount claimed appears accurate, and compare collection notices with your own records when possible. Finally, ask for information about the debt. Under federal law, debt collectors generally must provide certain information about a debt and consumers have rights concerning disputes.
Understand Your Rights When Dealing With Debt Collectors
Just because you owe a debt, does not mean collectors can harass you. The main law protecting your rights is the Fair Debt Collection Practices Act. This law sets certain rules in place that debt collectors must follow, including:
● No calls before 8:00 a.m. or after 9:00 p.m. local time.
● No calling your job if you notify them that it is not allowed.
● No profanity, threats of violence, or repeat calls meant to annoy.
● No lying about the debt amount or pretending to be law enforcement/attorney.
● No telling your coworkers, family, or friends about your debt.
If a debt collector fails to follow these rules, you are able to sue them for damages in a court of law.
Keep Records of Collection Activity
You should also keep records of all collection activity. This includes:
● Saving letters and notices.
● Keeping copies of written disputes and responses.
● Recording dates and general details of phone calls.
● Preserving documentation relating to payments or settlement discussions.
Organized records can be useful if a dispute develops or legal assistance becomes necessary.
Consider Your Options for Addressing the Debt
Finally, you need to consider your options for addressing the debt. There are a few ways to go about this. First, you can pay the debt in full. This is the easiest and quickest way to deal with debt. However, it is not viable for most people, as it considers having a large amount of money available.
You can also try negotiating a settlement. Debt collectors are actually quite willing to negotiate. If you contact them and explain that you cannot pay the entire debt, they may agree to take a lesser amount. Make sure to get any settlement agreement in writing before making a payment based on the agreement.
The final option is bankruptcy. Many people are scared of this option, but it is actually quite a useful tool. You can declare Chapter 7 or Chapter 13 bankruptcy. Either of these will take care of your debt. If you do choose to go the bankruptcy route, it is wise to obtain legal help. Any legal help you hire should be local to your area to ensure that they understand your local laws. For example, if you live in York County, Pennsylvania, you should find a York bankruptcy lawyer to help you.
Take Action
The most important thing to keep in mind is that you have to take action. If you ignore the debt, it will grow and grow. Not only that, but collectors may take legal action against you, which can lead to liens on property or wage garnishment. You need to make a plan and begin addressing your debt as soon as possible.
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