Even the most diligent payers of their debts can find themselves dealing with collection agents if their job is lost, a divorce occurs, or an illness or disability strikes.
Learning how to deal with collection agencies can be a smart move if this is the situation for you.
If you find yourself dealing with harassing collection agents you don’t have to panic as there are steps you can follow to help you deal with the collection agencies and negotiate savings that can help you avoid going bankrupt.
Here are Bankruptcy Canada’s tips for dealing with collection agencies:
Prioritizing your debt: You should pay off higher interest debts first, and attempt to negotiate on other debts. Tax debt and student loan debt can not be negotiated on but with credit card debt, for example, you can negotiate a deal with your creditors.
Make a deal with your creditors: If you have not paid on your debt for over a year and have not yet been sued by your creditors you can bargain with your creditors.
Avoid making a payment on your debt as this will reset the clock on your debt repayment.
You can try to negotiate with your creditors as they will often settle on a deal for less than you owe.
Find Out if You Can Get Sued: Often, when speaking with the agent for the collection agency they will threaten to sue you, but in many cases there is no legal basis for a lawsuit against you.
The collection agency is using a bluff to attempt to scare you into paying.
Find Out if Your Creditor or a Collection Agency is Calling: Your creditors will often attempt to collect from you for a period of time and your creditors often will demand a full repayment on your debt.
If, however, you are dealing with a collection agency, who is working for a commission, you can often negotiate a deal on your debts that you owe.
Repair Your Credit Rating: An improved credit rating can help you negotiate better payment terms or qualify for a debt consolidation loan that can save you thousands in interest charges and debt repayments.
Stop the Calls: Residents of British Columbia, Alberta, Ontario, Quebec and Nova Scotia can legally ask that collection agencies do not call you at home.
You can user caller ID to screen phone calls or you can get a new and unlisted phone number.
If you have any questions about this or other aspects of bankruptcy or consumer proposals you can set up a FREE consultation with our Government Licensed Insolvency Trustees.
You can also call Bankruptcy Canada directly at 1-877-879-4770.