How to Deal with Debt Collectors When You Can’t Pay?
How to deal with debt collectors when you can’t pay? This is an important question, especially if you are drowning in a lot of debt or perhaps dealing with a lot in your life already.
Read further for all the details to know.
Introduction
Ah, the dreaded phone call from a debt collector. Nobody likes to receive those calls. It does not matter whether you are at work, getting ready to have dinner with your family, or out on a date with someone special – there is never a good time for a call from a debt collector.
Sure, you may avoid the call this time, but that does not mean you lose that feeling in the pit of your stomach that makes you feel just, well, awful. And, when you do answer? It is even worse. The often-belittling voice on the other end of the line can crush any good mood.
Maybe you have tried to catch up on your missed payments. Maybe you lost your job. Maybe you are dealing with a serious medical diagnosis. Maybe you had a few rough years and have been trying to get your finances back on track ever since.
For most people, life means living paycheck to paycheck with little to no savings. And that means regardless of how many times those pesky collectors call you, you cannot pay.
So, what do you do? How do you deal with debt collectors when you can’t pay?
Don’t Avoid the Calls
Nobody wants to take calls from collection agencies but ignoring them forever will not make them go away. It is best to answer the call and take down the information. Even if you cannot pay, having an idea of what is going on, who has your debt, and so forth is better than pretending it doesn’t exist.
Know Your Debts
If you have seen any news lately, there are a lot of scams going on – and many involve people posing as debt collectors. They want to try to get money from vulnerable people often by using terrible business practices.
Ask for the account information. What is the debt for? Was there an account number? Get their contact information and advise them you will call them back. Check your records and research the company. If it doesn’t add up, it could be a scam.
Check Your Financial Priorities
Collectors can easily make you feel that your debt owed to them is an urgent matter – that it has to be paid right away. This could put you in a bind on the phone and cause you to agree to something you can’t even afford. Believe it or not, this could put you in a worse position.
If you take a call from a debt collector, gather the facts – the amount owed, the interest accruing, what they are offering as far as settlement or payments, and their contact information. Tell them you will review your finances and see what you can do and call them back.
You are under no obligation to make a decision right then and there.
Negotiate
There is no law that says debt collectors have to provide you with a break on the amount you owe. They do not have to give you a discount for paying in full or freeze interest if you agree to a payment arrangement. Most collection agencies will work with you to determine what you can pay and offer you discounts and deals to settle the account.
Truth be told, their client (usually the owner of your account) wants to see settlements and closed accounts because payment has been received. It looks good on the books. So, if they have to knock a little off to get another satisfied file, they often will. Always negotiate.
The Fair Debt Collections Practices Act
The FDCPA was put into place to protect you from the questionable practices of debt collectors. There are things that they can and cannot do – and it is good if you familiarize yourself with it so you know your rights.
It is common for debt collectors to call and try to invoke fear by making you believe you may be arrested or that someone will be coming to your house. Don’t ever just trust what the collector on the other end of the line is trying to tell you. It is their job to get paid for their client and those who think they do not have to follow the law will say anything to get your attention.
Talking to an attorney who practices in debtor’s rights is an important step to take. This is the best way to keep your sanity and your assets when dealing with collectors.
What Can Collection Agencies Do?
We know, reading and understanding the full Fair Debt Collections Practices Act can be a bit taxing. So, to break things down a bit, we have put together some common steps collection agencies can and cannot take. These include:
- Contacting you anytime between the hours of 8 am and 9 pm.
- Charging your interest on your account.
- Filing a lawsuit against you for payment.
- Communicating with your spouse, family members, friends, neighbors, and others about you or your debt.
- Attempting to collect on a debt that has passed the statute of limitations.
Here is what collection agencies cannot do:
- Garnish your wages, bank account, or levy your assets without having a judgment in place as the result of a court case they filed against you.
- Harass you in ways that are threatening, using foul language, or convincing you that you will be arrested.
- Continue to contact you after you have filed a cease and desist letter.
- Deceive you by not being honest about who they are.
Hire an Attorney
There is some comfort to be had when it comes to having someone on your side, especially if you end up wanting to sue a debt collector. Hiring an attorney is that person. They know the law and understand what is and is not allowed with the FDCPA as well as what can be done to protect your rights. Not to mention that when you are represented by an attorney, he or she will be the one to handle all your collection calls – assuming it is stated in your agreement.
If you are feeling overwhelmed by debt collectors and can’t pay your debts, seek legal help today.
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