managing-debt

Control Debt by Dealing With Debt Collectors Effectively

Debt collectors are never a phone call you want to receive. Their job is to pursue payment and getting constant pressure to settle that debt. Before you get frustrated and simply ignore your debt, below are a few ways you can navigate your debt with debt collectors.

Take Responsibility

Ignoring your debts does not make them go away, and it only makes it worse. If a debt collector calls asking for payment, reach out to the original company before paying your debt to know what you’re paying. If the debt has not been turned over to the debt company, you can work with the original company with the balance. If it has been turned over to the debt company, get the name of the debt collection company and all the details you can.

It is best to know what and who the debt is owed to.

Keep Track of your Debts

When a bill comes into your email or mail, tag them or file them into a safe place. Just make sure to not lump all your bills together. By splitting your debt out into bills and categories, it will help you understand what obligations you have and be able to find it easier when you need to reference it.

Do Not Be Afraid to Ask Questions

  • When you receive a phone or letter about a debt that you do not recognize, do not ignore it. Ask the debt collection what the debt is and if you do not owe it, get it cleared up.
  • If debt is owed, ask about terms and payment options.
  • Make sure you keep records and copies of all transactions. You might need to show proof of payments you have already made.

Be Polite

Remember, a debt collector’s job is to collect payment on a debt. Being rude or aggressive with a debt collector does not help your debt situation. They are simply doing their job, so chat with them to determine the best next steps for you.

Decide Right Away About Which Bills You Will Begin Paying

Let the company know that you plan to pay and when.

Be Cautious

Before you agree to a payment plan, sometimes it is better to talk to an attorney before agreeing to anything. As soon as you pay you will be subject to interest and all other charges which could grow your debt substantially.

Get a Side Hustle

When a debt collector attempts to get a hold of you, know that you can sometimes negotiate to settle your debt. For example, if you owe $1,000 but if you agree to pay off the debt at that moment you will only owe $600. Having cash on hand will allow you to pay this off, get rid of the debt plus a bit of a discount.

As stated above, that means you need to have $600 dollars ready to pay immediately. To earn that you can get a side hustle. That could drive for a food delivery business such as Uber Eats or DoorDash. Maybe you can help on a temp job board such as Task Rabbit. These things do not need to be long term, but might help you make just enough to get rid of the debt and settle with the debt collector.

Certify your Payments

When you have debt, a company can choose to use one or more collection agencies. Unfortunately, during these transfers of debt, your payment history or even your payments are lost.

The best course of action here is for you to keep track of what you have paid, what has not, and what do you owe. Beyond your own notes, make sure you can prove all of your records. If you cannot provide proof or the debt collector needs more evidence, talk to an attorney.

Final Thoughts

Know that you have the power and can manage your debt to get debt free. Only you can change your financial future so take it one step at a time and before you know it you will be back on the path of financial independence.

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