No one wants to get into debt. No matter the reason you find yourself in this situation, it can be overwhelming to be unsure of the way out. You don’t want to stay in debt, but you’re struggling to pay it all off. What can you do? Right now, the most important thing is to learn how to deal with debt collectors. One of the most important things you need to know when a debt collector calls you is that you have legal rights. No matter how much you owe and how far behind you are, they are not allowed to harass and intimidate you. There are ways to make a bad situation a little better.
How to Deal with Debt Collectors When You Can’t Pay
Whether you’re a little short this month or seriously behind on payments, it’s best to act quickly to minimize the damage of having debt you can’t afford to pay. At this point, you don’t have many great options, but there are some things you should do and some things you shouldn’t do (although you probably want to!)
DO:
Request specific information about the debt.
Without admitting the debt is yours, get information from the debt collector. Ask who the original creditor was, the amount of the original debt, and how much is still owed. The more details the debt collector can provide, the better.
Try to reach an agreement or negotiate
Now is the time to see if the debt collector will accept a portion of the cost if you pay upfront. They may decide that some money is better than no money. If they still want the full amount owed, you may be able to set up a payment plan.
DON’T
Ignore repeated attempts to contact you.
Ignoring a debt collector when a debt is yours can cause further damage to your credit score and report. Plus, it won’t work anyway. Debt collectors will continue to contact you until the debt is paid.
Admit the Debt Is Yours
Did you notice above that we told you not to admit it’s your debt? If the statute of limitations has expired, the debt collector can no longer sue you to recover the debt. Admitting a debt is yours can reset the clock on past debts. That’s why it’s never a good idea to do so, even if you know the debt is yours.
Giving Out Personal Information on the Phone
Even if you’re nervous and they insist, avoid over-talking. Don’t share anything over the phone, not even if you can pay and how you plan to do so. Instead, request a letter with the original debt information. Share as little as possible about yourself, your home, your family, your job, and your financial situation.
We know this is scary, confusing, and difficult. We are here to help you! At this point, it’s essential to learn how to manage that debt efficiently. We have a team of professionals here to help you stay on top of your financial obligations and ensure you pay off your debts as quickly as possible. Ignoring calls and not negotiating a payment plan will damage your credit report and make it difficult to obtain essential financial loans and qualifying lines of credit in the future. Our credit counselor will review your current financial debt profile and help you determine the best way to improve your credit. This is just one of the services we offer!
