Keeping Creditors at Bay: How to Deal With Debt Collectors

Are you trying to keep the creditors at bay but you aren’t sure what to do? Read this article to learn how to deal with debt collectors.

It’s easy for anyone to find themselves in a place of financial difficulty. This is especially true in America, where nearly half of American families are living paycheck to paycheck. If you’ve fallen behind on your bills, it’s understandable, but that doesn’t mean debt collectors are going to just disappear.

Do you know how to deal with debt collectors? If you’re behind on numerous payments it’s a skill you might need to learn fast. 

There are many different actions you can take to best deal with debt collectors at your door. Read on and we’ll walk you through everything you need to know.

Know Your Rights

Debt collectors put on a scary character to try and get people to pay the money they owe. They might write or call or otherwise reach out with dire seriousness, using severely-worded phrasing and threats to get worried debtors to pay up.

While it’s important to take these debt collectors seriously, it’s important to keep perspective and know your rights too. There are laws in place (under the Fair Debt Collection Practices Act) that dictate the actions that debt collectors can and cannot take when working with individuals.

The law, broadly speaking, prevents collectors from engaging in abusive, unfair, or deceptive practices. Depending on what state you live in, there might be further laws that work to protect the consumer from unfair tactics from debt collectors.

Some actions that are forbidden under federal law include contacting a consumer early in the morning or late at night or contacting you at your place of employment if you’ve requested not to be.

Debt collectors are also not permitted under these laws to contact third parties for any other reason than gathering your contact information. They cannot contact someone in an attempt to gather incriminating evidence against you, nor can they attempt to rope this third party into helping their cause.

The law also prohibits collectors from lying or harassing the consumers that they are sent to collect from. What lies could a shady debt collector possibly employ?

They could lie about the amount you owe, pose as a law enforcement official, or make claims about punishments that won’t actually occur.

You can even request in writing for a debt collector to stop contacting you. If you do this, that company will have to honor the request, though this means a lawsuit from your creditor will likely be around the corner. 

Attempt to Negotiate

It’s the logical assumption that if a debt collector is after you it’s because you do not currently have the money you need to pay off your debts (and not that you’re ignoring this particular payment purposefully). 

If this is your situation, there are steps you can take to attempt to make your debt more manageable. The first thing you can do is offer to pay a fraction of what you owe as opposed to the full amount. Paying nothing will leave yourself open to a lawsuit, but paying a fraction might ease the pressure from a collector for the time being.

It’s best to start low because you never know what might happen with this arrangement in the future. What portion of the money are you able to pay currently? See if your debt collector would be willing to accept it. 

The willingness of your collector will likely depend on the overall sum of the debt, the services or products that were provided, and most importantly, how long the money has been owed. 

Looking for Help

If you aren’t able to sort out your finances on your own, you may want to look for help from a credit counselor. A counselor has a strong financial background and can aid you in creating an efficient debt management plan.

They will be able to help you negotiate with your creditors and create a payment plan for you to follow through on over the next months or years. They can help you with the particulars of your situation, whether that be learning how to pay off loans as a homeowner or how to recover from small business losses. 

If you do work with a creditor, make sure that you work with a nonprofit and ensure that this person’s background is legit before you sign any paperwork. You don’t want to get yourself into further trouble by not doing your research.

File for Bankruptcy

If you’re really in dire straits, filing for bankruptcy can be one way to quell the flood of debt collectors at your door. Filing will immediately halt all collection attempts from any agencies out there.

Depending on how you file (you might want to seek advice from an attorney) you will be able to eliminate your debts by liquidating your assets and distributing these proceeds. If you are still unable to pay the full amount, the court will set you up on a payment plan that can stretch out over the course of many years. 

No one wants to file for bankruptcy but if you’ve found no other ways to deal with your debt, it can be the only way out. Fortunately, businesses like Day One Credit have tons of free resources so you can be prepared to handle everything coming your way. 

How to Deal With Debt Collectors

Do you know how to deal with debt collectors? If you owe money to creditors you will need to understand how best to deal with the collectors that come knocking. The above information can be hugely beneficial.

Do you need more advice, tips, and tricks on how to handle your personal finances? Keep scrolling our blog for more information. 

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