Maybe a job loss, medical condition, or expensive divorce has landed you in a financial mess. Maybe it was poor money management. No matter the reason, being unable to pay your bills is a super stressful situation, and the worry and strain usually bleeds over into your work life, personal relationships, and sometimes even impacts your health.
If some of your debt obligations have gone to collections, you know the pain of being contacted frequently, and may have even received threats from them. These types of letters and calls make a bad situation worse.
Even consumers in the most dire financial circumstances can make moves to better themselves, and dig their way out of hole they are in. It begins with understanding you DO have control over the harassing phone calls, messages, and other correspondence from aggressive debt collection agencies.
Here are four actions to take to stop debt collectors from harassing you:
1. Face reality.
Throwing away collection notices and hitting “silent” every time you get a call are not solving the problem, and will only make it worse. Yes, financial issues are overwhelming. No, you can’t wish them away. Over time, debts can add enormous amounts of late payments and interest charges until the balance is double or triple the original amount! Avoiding or ignoring debts and collections only digs you in to a deeper financial disaster that takes longer to get out from under.
The sooner you wrangle your bills under control, the brighter your future looks.
Action plan: Start at the beginning. Open those envelopes and start a log of your debts. Note each creditor, whether or not the debt has already gone to collections, and the outstanding balance.
After this, you need to order your credit report. Review every line, add the debts to your log, and note each creditor that shows up.
Being aware and accepting of where you are financially is the first step in taking control.
2. Know your rights.
While you are working to get your finances in line, remember that you have rights when it comes to harassing creditors. You are not required to put up with phone calls at all hours of the day and night, or at work!
The Fair Debt Collection Practices Act (FDCPA) was created especially for protecting consumers from aggressive collection agencies. The FDCPA puts specific limits on how often debt collectors can contact you, limits them on talking to third parties about you and your debt, and the times of day they are limited to calling you. They cannot threaten you, use obscene language, or call you repeatedly in a short time frame.
Action plan: Familiarize yourself with the language of the FDCPA. Make certain you know and understand your rights when it comes to collection attempts, and your recourse if they violate the rules.
3. Send written documentation.
Now it’s time to make moves to improve your situation. Even if you talk to the collection agencies over the phone, it’s important to send all agreed upon matters in writing. A paper trail protects you as the consumer, and minimizes the risk of costly misunderstandings.
Action plan: If you are being harassed, talk to the collectors one time and tell them to stop. Send a certified letter backing up your request to the collection agency AND the holder of the original debt.
Request a validation letter from each debt collector, which they are required to send within 5 days of your first contact.. This document explains your debt balance, and your rights. Add this to your log.
If the collection agencies continue to harass you, or fail to follow the guidelines of the FDCPA, file a complaint with The Federal Trade Commission and The Consumer Financial Protection Bureau.
NOTE: A shocking percentage of debt collection efforts are targeted at the wrong consumer. Similar names, for example, are easily mixed up. If you are receiving correspondence on a debt that isn’t yours, it’s imperative to resolve this immediately. Send a letter to the collection agency disputing the debt, including a copy of any proof that the collection doesn’t belong to you. Review the credit report you have already pulled on yourself. If the debt shows up, dispute it with the credit bureaus.
4. Get proactive.
It’s a smart practice to acknowledge the debt if, indeed, it belongs to you. Paying it, or making a plan with the creditor, is the fastest and most effective way to stop the harassing communication. Take responsibility for your finances and work out a way to handle the collection.
Action plan: First, if you have the financial resources, try to negotiate with the agency. Offer to pay the debt if they will send you a letter that it should have never have been sent to collection. This can later be disputed with the bureaus, and hopefully results in the collection being removed from your credit report.
If you can’t afford the cash of the first scenario, offer to settle the debt for less. Tell the creditor what you can give them, and ask if they will consider that as payment in full. It’s essential to get anything they agree to in writing! A downside to this option is that the collection will still show and impact on your credit report.
The final option helps if you have little money available. Set up a payment plan. You and the creditor hash out a monthly plan of attack to decrease your debt. This is the least attractive option, because it drags out the issue, making you deal with it longer, and still has a negative impact on your credit score. But, if the other scenarios aren’t viable, this will eventually get you out from under the debt obligation and on your way to a solid financial footing.
You do NOT have to put up with the stress of being harassed by debt collectors. By knowing your rights, you can empower yourself and take action to address your situation in a proactive manner. These four plans of action will set you on a course of protecting your peace of mind, and repairing your financial future.
