Disclaimer: If you’ve experienced debt collection, the following information is not tantamount to actual legal advice. It only serves as general guidance as to the legal aspect of debt collection. To further understand the legal nature of debt collection, it’s recommended that you talk to a licensed lawyer who has experience in the subject matter similar to yours.
In most cases, debt collection can be annoying, especially when tactics used are illegal or destructive. There are times when a debt collector is chasing you, asking payment for a debt you owe them. That’s why it’s essential that you know how to handle debt collectors so that you can also manage your debt correctly. In effectively legally dealing with debt collection, below are some things to consider:
#1. Gather The Facts And Ask For The Information In Writing: Debt collection is a legal process resulting from personal or business debt and other financial matters.
- When a debt collector starts calling you about your debt, it’s best if you think first before you act to avoid worsening the situation. As much as possible, get the information in writing to verify the details of your debt including the amount of money you owe, the name of the creditor and the actions they’re going to take against you if you fail to pay.
- Remember to ask the debt collector to send you the information before continuing communication with them.
- Take note and keep records of messages and phone calls with the debt collector. Write down all relevant information so that you know how to interact with them.
- During the first contact, it’s a good move if you keep the conversation short as much as possible. Stay focused, say little and stand firm when the debt collector begins telling you about your debt.
- Keep in mind that you should not pay, you should not promise to pay, and you should not provide any information that the debt collector may use against you. Simply gather the facts and say that you’ll get back to them for further discussion.
#2. Know Your Rights: When you’re being hounded by a debt collector, it’s best if you’re aware of your rights under the law. If you’re dealing with business-related debt, hiring an experienced business law attorney can assist you in this process.
If a debt collector communicates with you, make sure to have yourself familiarized with the conduct expected of them during debt collection:
- A debt collector must not use physical force or coercion.
- A debt collector must not deceive or mislead you.
- A debt collector must not harass you to an unreasonable extent.
- A debt collector must not take advantage of your vulnerability or any attending circumstances.
Remember that a debt collector is only allowed to contact you when there is a necessity and if the contact is done for a reasonable purpose. Below is what is considered to be a reasonable purpose:
- Contacting you to demand payment.
- Making arrangements for repayment.
- Reviewing a repayment plan after an agreed period.
- Calling to find out why an agreed repayment plan has failed.
Take note that debt collection is not intended to invade your privacy. Make sure that the debt collector exercises due diligence in safeguarding your personal information at all times.
Keep in mind also that visiting your home should only happen if there’s no other way the debt collector can efficiently contact you regarding your debts. If debt collection can be made through phone, any face-to-face conversation is unnecessary.
If you think that the debt collector is demanding something that you’re unaware of, remember that you have the right to dispute the debt. For instance, you can challenge the debt on the following grounds:
- If it’s not your debt.
- If you have already paid your debt.
- If there is a reason to dispute the amount of your debt.
#3. Try To Negotiate: In debt collection, do not give in to pressure to pay after the first communication.
- When the debt collector starts demanding payment from you, do not rush to make payments without understanding everything about the process.
- Take your time to think about the available options before making any payments.
- Do not be afraid to make negotiations about your debt to avoid any severe repercussions. Always know your rights when handling debt collection.
- Make sure that you have copies of records about the debt including any previous payments made to serve as pieces of evidence.
#4. Look For Other Ways To Pay Off Debt: Once you’ve already understood your debt as well as your consumer rights, it’s about time that you think and look for other ways to pay off your debt.
- Take note that payment negotiations can also fail depending on your circumstances. That’s why it’s recommended that you try to look for available ways to pay off your debt as soon as possible.
- Debt collection is stressful when done with pressure and urgency. If you think the debt collector is pressuring you to pay your debt but you also see no other way to pay them off within the next few months, maybe it’s about time you consider filing for bankruptcy.
Debt collection can be a complicated process, especially if you’re dealing with a demanding debt collector. Know and practice your rights so that these collectors won’t force you to fall into their traps. If you’re concerned about debt collection, it may be wise to find an attorney in your area who’s well versed in matters like yours. We hope that the examples mentioned above can give you an idea as to what are the effective ways to legally deal with debt collection.