If you owe money to someone, be they a credit card company, loan provider or individual, then they are what is known as a creditor.
Being in debt and unable to pay back what you owe to your creditors can be a very uncomfortable situation which will only get worse as time goes by, so here’s how best to handle it.
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Dealing with your creditors
If you owe a debt and are unable to make your repayment, then your creditors themselves, a collection agency or a debt collector will likely be in contact with you.
Calls from your creditors and the people they employ to collect on their behalf, can be extremely stressful, especially as many of these individuals can be aggressive, difficult to deal with and unsympathetic to your situation.
The first thing that you need to do is to know the law because there are a number of things that debt collectors cannot do.
Things debt collectors cannot do
- Visit your property or call you without first trying to contact you in writing.
- Threaten you or use abusive language.
- Contact your employer, friends or family for any reason other than to verify your phone number, address or employment status.
- Depending on the province you live in, there are restrictions on the number of times that debt collectors or creditors can contact you in a set time period.
What you should do and say to your creditors or a debt collector
As unpleasant as it may be, you cannot hide from your creditors or their collection agents and you must tackle the issue head-on if you want it to go away.
Here are some things that you should do and say in the event that a creditor or a debt collector contacts you:
Verify their details
Ask the person their name and where they are calling from and which debt they are contacting you about.
It is important that they are able to verify that the debt is accurate, and if for any reason it isn’t then you should inform them of this.
Every time you speak with a debt collector or one of your creditors, take notes during the conversation regarding who you spoke to, the date and time, and what you discussed.
This will help you to keep a timeline of events that could come in handy during a future exchange.
Try to come to an agreement
Although many creditors and their collection agencies may sound like they are going to be uncooperative, most just want to get their money and will negotiate with you if you are unable to make your payment.
Although tensions may be high and you may be very frustrated it is vital that you try to remain calm.
Don’t raise your voice or use abusive language as this could cause your creditors to refuse to negotiate with you.
What to do if things have gotten too much
If your creditors will not negotiate with you or you simply cannot handle them alone, then you may want to work with a Licensed Trustee, who will be able to contact your creditors on your behalf and to put a plan of action in place to help you pay back what is owed.
As soon as a Licensed Trustee gets in contact with your creditors, all action against you must stop.
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Consumer Proposal Eligibility
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Personal Bankruptcy in Canada
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