It is quite common for an individual to mismanage his or her finances and end up in a pile of mountainous debt going to collections. Eventually, this will be followed by annoying debt collectors that are very persistent in calling you up and reminding you of your debt. Most people get caught up in the moment, feeling pressured and stressed out, that they can’t think straight anymore and begin to overlook simple strategies that they can utilize in order to escape this mess.
Don’t forget that you have rights and you can use them so that you can get back up on your feet and have a fresh new start. Keep in mind that it’s not the end of the world for you. Here are simple tips that you can use in order to overcome debt collections.
Gather Yourself and Calm Down
Yes, receiving a letter or answering a call from a company about your debt is not something that you want to hear. Debt collectors can be quite intimidating and will haunt you like a shadow. Don’t let their intimidation cloud your ability to think rationally. As previously mentioned, you have your rights and you are entitled to exercise those rights. Moreover, being evasive with their inquiries will only give them more power over you. So as soon as you receive a notification from them, respond to and reply to their message accordingly. You can even ask for details on your debt and negotiate them for alternatives like acquiring a consumer proposal auto loan.
Make Sure That You Are Dealing With the Right Debt Collector
Fake debt collector scams are quite rampant these days. Always be vigilant and don’t be too trusting. Ask for their contact info and do a background check on that collection agency over the internet. Take note that these are elaborate scams that can even go far as to knowing your personal data – so don’t be fooled. The last thing you want is giving your money to a fraudulent debt collection company.
Check their website or call them for verification. To be safe you can personally visit them or ask others about their legitimacy. If the debt they are referring to is from your credit card bills, contact the bank that issued your credit card for verification purposes.
Ask For Your Credit Report
There are 3 major credit agencies assigned to evaluate your credit report, namely: TransUnion, Equifax, and Experian. Nowadays, despite the fact that every information is input and stored via computer, mistakes are still very much possible. So for your sake, you should check the details of your debts so that you can personally verify the validity of that debt. Who knows? You might find an erroneous data that will decrease your total debt amount. In addition, it is also better for you to keep track of your credit card purchases because some collection agencies place inaccurate numbers that can really worsen your case. You are entitled to have a free copy of your credit report once per year, so take advantage of that privilege.
Make the Call
As far as your end is concerned, you have verified your debt and checked your credit history. Call the credit agency and ask them questions such as who they bought the debt from and what was the original amount of the debt. Just in case you were billed of a debt that does not belong to you, send them a letter (within 30 days) notifying them that you don’t owe that certain amount. More importantly, you should keep a copy of your conversation for record-keeping purposes. You might need them in case of a formal hearing.
Haggling for a Lower Amount
Collection agencies make a living by buying overdue debts from a lender (i.e. bank, etc) at a price that is extremely lower than that of the original balance. For instance, if you owe your original lender $4,000, debt collectors might have bought that debt at a fraction of that amount. Therefore, regardless if you pay the total balance or not, they can still profit from that certain transaction that is why sometimes they offer a discount deal if you agree to pay a certain amount. You can start off the negotiation by offering to pay them 10-15 percent of what you originally owe. So if they say your outstanding balance is $4,000, tell them that you will pay $400 – $600. Some of you might think that this is ridiculous but bear in mind that they could’ve bought your debt for pennies on the dollar.
Be Firm During the Negotiation Process
Now that you have established a starting point for the negotiation, stand firm with it. In actuality, you might end up paying 30-40 percent of what they originally asked from you, no more than that. That is why it is very crucial to do your own research regarding the details of said debt so you can prepare yourself during the negotiation process. Since you are already knowledgeable about the entire details, you won’t get easily intimidated by their “scare tactics”. If everything goes well, they will eventually give in and accept your terms in order to cut further losses. Taking the time to do extra research is totally worth it.
Don’t let them push you around. Carefully assess your situation and verify all information that they have given to you. By considering your options, you might just be able to bargain for a price that is more affordable. Having said that, New Car Canada doesn’t mind if you have bad credit or unsettled debt collections. We have the best auto financing services in the country at a price that anyone can afford no matter what your credit issues are. Start rebuilding your credit by completing our 1-minute online application form and choose the vehicle that is right for your budget. We can help you get back up on your feet. Our application is completely FREE with no added obligations or hidden charges. Avail of our incredibly low offers today.
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