Navigating Collections: A Comprehensive Guide to Dealing with Collection Agencies and Collectors
Dealing with collection agencies and collectors can often be a daunting task. Their persistent calls and intimidating demeanor can be a source of stress for those who are already dealing with financial difficulties. However, understanding their role, knowing your rights, and learning effective strategies to handle them can greatly ease this process.
This guide aims to help you navigate these challenging encounters, providing you with the necessary tools to tackle these situations with confidence.
Understanding the Role of Debt Collectors
Debt collectors are professionals tasked with retrieving debts on behalf of creditors. They are often paid on commission, which drives their motivation to collect. Debt collectors are not your enemy. They are simply doing their job, which is to convince you to settle your debt.
The Impact of Bankruptcy on Debt Collection
When you file for bankruptcy, it offers immediate relief from your unsecured creditors. Once the bankruptcy proceedings begin, these creditors are not legally allowed to recover their debts from you, seize your property, or garnish your wages. All listed creditors in your bankruptcy are advised of your situation via a Creditors Package from the Trustee’s office.
However, you may still receive calls from debt collectors under certain circumstances even after filing for bankruptcy:
- The collection agency may not have received the Creditors Package in time.
- Your listed address for the creditor may be incorrect, or the collection agency may have changed.
- The original creditor may have received the Creditors Package but failed to notify the collection agency.
Handling Calls from Debt Collectors
When a debt collector contacts you, it’s essential to remain calm and collected. Gather as much information as possible to help resolve the situation. Here’s what you should do:
- Obtain the name of the company, their address, the caller’s name and contact details, the amount owed, and the name of the creditor who passed your account to them.
- Request a written notice concerning the debt. This is crucial as it serves as your written proof of the debt.
However, you should avoid doing the following:
- Signing any documents or attempting to pay off the debt without verifying it.
- Ignoring the collector’s calls. This will not stop them from contacting you and may lead to a lawsuit against you.
How to Deal with Harassment from Collectors
Collection agencies are regulated by specific legislation, depending on your location. If you’re repeatedly contacted by a collector looking for someone else, it may be considered harassment.
You can stop these calls by:
- Informing the debt collector you wish all future correspondence to be in writing.
- Sending a cease and desist letter if you are contacted at inappropriate times or if your friends, family, or coworkers are contacted.
Your Rights under the Fair Trading Act
The Fair Trading Act provides certain protections for consumers dealing with debt collectors. These include:
- Prohibition of deceptive practices or misrepresentation.
- Limitations on contact frequency.
- Restrictions on the use of offensive language.
- Protection of your employment information.
- Requirement for written notice of debt.
- Privacy of your debt information.
If a debt collector violates any of these rights, you can file a complaint with the appropriate consumer protection authority in your jurisdiction.
Negotiating with Collection Agencies
The amount you owe to collection agencies or creditors is negotiable. If you choose to deal directly with them, you can negotiate the total amount, the number of payments, and the payment deadline. Always request a written agreement of your payment plan and ask for a legal clearance once the debt is fully paid.
Seeking Professional Help
For a permanent, legal solution to your unsecured debts, consult a licensed Trustee in Bankruptcy or an Administrator of Consumer Proposal. They can provide you with all available options under the federally legislated Bankruptcy & Insolvency Act (BIA).
Remember, dealing with collection agencies and collectors is a process that requires patience, understanding, and strategic planning. By having a clear understanding of your rights and obligations, and by taking a proactive approach, you can effectively navigate your way through this process.
