Negotiating Debt

No one wants to dodge calls from debt collectors. Maybe you break out in a sweat when the phone rings. Perhaps you’ve learned to just send all unknown calls to voicemail. But at the end of the day, you still have debt, even if you’re not dealing with it. We’ve got a great guide on how to deal with debt collectors that’ll take the anxiety out of those calls and help you get your debt under control.

 

Stick To The Script

Be honest if you’ve faced hardship that has made making your payments difficult. If there’s been an illness or loss of income, let them know.

 

Avoid the Theatrics

Stay calm no matter what the debt collector says. Don’t lose your temper, don’t panic. If you do become overwhelmed, tell them you’ll have to tlak to them at another time and hang up. You can tell the debt collector that you’d like the conversation to be recorded and this will usually keep them on their best behavior.

 

Ask Questions

If the debt collector says you’ll be sued or have property taken, ask questions. Many of these threats are illegal. Know your rights. The more information you have, the better equipped you’ll be to handle the situation.

 

Take Notes

Write down all information passed on to you. Include their name, company, title and what has been discussed. You’ll have a record of what went on, and if the collector broke any laws, you’ll have that on hand too.

 

Know What’s In The Budget

Figure out what you can afford. Offering a lump sum can drop what’s owed, sometimes as much as %70. Since debt collectors buy debt for pennies on the dollar, they still make a profit on collecting even deeply reduced debts. By negotiating, you may even be able to afford to pay off one or two debts a month and swiftly eradicate this source of financial stress.

 

Deal with Creditors before Collectors

If you owe, speak to your creditors before your account goes to collections. Ask for a payment plan and stick to it, even if it’s only $20 a month. Once an account is in collections, it can damage your credit worse than just falling behind with a creditor.

 

Get Proof

If you’ve agreed to a payment arrangement, ask for it in writing before sending them a penny. This way terms cannot be changed on you and you won’t get hit with surprise charges.

 

Derogatory Remarks

When paying off debt, request that companies remove derogatory remarks upon payment in full. If a creditor won’t remove the mark, it could stay on your credit for up to seven years.

 

Get Help

If you are struggling with multiple creditors or debt collections, reach out to a credit counselor or debt consolidation professional to see if their services could help you.