The definitive guide for dealing with a collection agency...
Date: Thu, 11/01/2007 - 06:57
Most importantly, I don't care how much they scream, cuss, argue, say it isn't possible, or what ever….do not EVER EVER EVER EVER EVER give them post dated checks or electronic access to your checking account. They will cash all the checks at once, sending your account into overdraft and possibly bouncing your mortgage payment, etc or they will clean your account out with electronic access. In fact, don't even send them a personal check….they can get your routing and account numbers off the check and clean your account out. Only send them a money order or cashier's check overnighted. If they tell you that no deal can be struck until you give them post-dated checks or electronic access, just say "Okay, then I will send the money I was going to settle your account with to another creditor and we can try again in a year when you will settle for less money" then hang up.
Okay, was I unclear about not letting them have access to your accounts or post-dated checks? I hope not. So here is how you proceeed:
1) Get caller id and don't answer the phone if it is number unknown or the collection agency number except for once a week.
2) Talk to the collector once a week at the MOST. Tell them, "I will talk with you once a week as long as you speak to me in a dignified manner"
3) If they are abusive, then hang up on them.
4) Be blunt and emotionally detached--as if you are negotiating for a client--and tell them what you are willing to do to settle the debt. If that isn't acceptable, then just say "Okay, I will talk to you in a week or so". The longer it ages and the more they see they can't control you, the more likely they will be to cave and settle.
5) If you haven't paid in a long time, they will probably settle for 50 cents on the dollar or less--OF THE ORIGINAL AMOUNT DUE, not their fee inflated amount.
6) Do not let them get you upset. If you are upset, you are more likely to spend your mortgage payment to pay a non-secured debt. No, they can't put you in jail for a bad debt…there are no debtors prisons. The wost thing they can do on a non-secured debt is sue you (really that is no big deal…kind of like traffic court). After they win, you will just set up a payment plan anwyay.
7) I personally would go for the settlement instead of the payment plan because they are lowlives you will be dealing with for an extended period of time if you do a payment plan. Plus, they lose payments, etc. so that they can say you never sent them and call the amount (plus additional interest and fees).
8 ) Negotiate away their dumb fees….they bought the bad debt for very little based on the original amount due. Tell them you will settle for 50% of the original amount. If they bawk, tell them "Okay, talk to you in a week or two" and hang up.
9) Never agree to anything until and unless you get it in writing that the agreed upon settlement/payment plan will be determined payment in full with no recourse. No matter what they say about the payment MUST be in by the end of the month, don't believe it. They need it so that they can get their collector bonus. Heck, I would even screw with them if they are giving you a hard time and say "I was going to send it in before the end of the month but I don't really like you so I will wait so you don't get your bonus on me this month".
10) If you cannot pay the debt or make payment arrangements with the collection agency, don't fear the lawsuit. Most people freak out and do something stupid like sending in food money to prevent the lawsuit. If you are sued, you will be contacted by a lawyer's office ahead of time and it is that time where you have the best chance of dealing with an actual human. Call the lawyer's office and try to settle for 50 cents on the dollar or set up a payment plan with them. They will actually be intelligent and most are even nice and human. Once you make that payment arrangement, STICK TO IT.
11) If you happen to hit a very abusive collector….one that calls your friends, family, or work…send them a letter telling them to bug off (return receipt requested) and not to contact you about this debt any further. Eventually, you will be sued and you can deal with the lawyer's office at that point when you can settle it for much less.
Once you have a debt that was paid in full with a collection agency (or even normal, non-late debts) keep a copy of the records FOREVER….I will guarantee you with a certainty of about 80% that someone, somewhere will come back and say you never paid that debt. Old tapes are loaded on accident, lying scumbag collectors try to recollect a debt from weak people, etc. It will come back.
Just remember….control. The worst thing that can happen is that they can sue you (or repossess your car if it is a secured loan). Remain calm, remain in control. They can do very little but bug you with phone calls. Remember, that collector wants you to pay more than you want to pay, which gives you the upper hand in negotiations.
I never worked as a collector but I did work in a place with collectors. The happiest collectors were the meanest because they got people to pay their mortgage money or food money. The most frustrated collectors were those dealing with the people who did the steps above. The collector couldn't make them mad, upset, or scared. The collector couldn't really affect them any way at all so the collector basically had to sit back and hope the person would deal with them.
Okay, was I unclear about not letting them have access to your accounts or post-dated checks? I hope not. So here is how you proceeed:
1) Get caller id and don't answer the phone if it is number unknown or the collection agency number except for once a week.
2) Talk to the collector once a week at the MOST. Tell them, "I will talk with you once a week as long as you speak to me in a dignified manner"
3) If they are abusive, then hang up on them.
4) Be blunt and emotionally detached--as if you are negotiating for a client--and tell them what you are willing to do to settle the debt. If that isn't acceptable, then just say "Okay, I will talk to you in a week or so". The longer it ages and the more they see they can't control you, the more likely they will be to cave and settle.
5) If you haven't paid in a long time, they will probably settle for 50 cents on the dollar or less--OF THE ORIGINAL AMOUNT DUE, not their fee inflated amount.
6) Do not let them get you upset. If you are upset, you are more likely to spend your mortgage payment to pay a non-secured debt. No, they can't put you in jail for a bad debt…there are no debtors prisons. The wost thing they can do on a non-secured debt is sue you (really that is no big deal…kind of like traffic court). After they win, you will just set up a payment plan anwyay.
7) I personally would go for the settlement instead of the payment plan because they are lowlives you will be dealing with for an extended period of time if you do a payment plan. Plus, they lose payments, etc. so that they can say you never sent them and call the amount (plus additional interest and fees).
8 ) Negotiate away their dumb fees….they bought the bad debt for very little based on the original amount due. Tell them you will settle for 50% of the original amount. If they bawk, tell them "Okay, talk to you in a week or two" and hang up.
9) Never agree to anything until and unless you get it in writing that the agreed upon settlement/payment plan will be determined payment in full with no recourse. No matter what they say about the payment MUST be in by the end of the month, don't believe it. They need it so that they can get their collector bonus. Heck, I would even screw with them if they are giving you a hard time and say "I was going to send it in before the end of the month but I don't really like you so I will wait so you don't get your bonus on me this month".
10) If you cannot pay the debt or make payment arrangements with the collection agency, don't fear the lawsuit. Most people freak out and do something stupid like sending in food money to prevent the lawsuit. If you are sued, you will be contacted by a lawyer's office ahead of time and it is that time where you have the best chance of dealing with an actual human. Call the lawyer's office and try to settle for 50 cents on the dollar or set up a payment plan with them. They will actually be intelligent and most are even nice and human. Once you make that payment arrangement, STICK TO IT.
11) If you happen to hit a very abusive collector….one that calls your friends, family, or work…send them a letter telling them to bug off (return receipt requested) and not to contact you about this debt any further. Eventually, you will be sued and you can deal with the lawyer's office at that point when you can settle it for much less.
Once you have a debt that was paid in full with a collection agency (or even normal, non-late debts) keep a copy of the records FOREVER….I will guarantee you with a certainty of about 80% that someone, somewhere will come back and say you never paid that debt. Old tapes are loaded on accident, lying scumbag collectors try to recollect a debt from weak people, etc. It will come back.
Just remember….control. The worst thing that can happen is that they can sue you (or repossess your car if it is a secured loan). Remain calm, remain in control. They can do very little but bug you with phone calls. Remember, that collector wants you to pay more than you want to pay, which gives you the upper hand in negotiations.
I never worked as a collector but I did work in a place with collectors. The happiest collectors were the meanest because they got people to pay their mortgage money or food money. The most frustrated collectors were those dealing with the people who did the steps above. The collector couldn't make them mad, upset, or scared. The collector couldn't really affect them any way at all so the collector basically had to sit back and hope the person would deal with them.
some very helpful info and a plan of action that makes sense to
some very helpful info and a plan of action that makes sense to me. Makes me wonder if you can modify a limited cease & desist to something like, "It is inconvenient for me to receive more calls then once a week. I require that your offices only contact me once per week. If you contact me more then that amount, you are violating my rights."
I don't think that would work....just like everything else. If
I don't think that would work....just like everything else. If you give them permission to call once, they will call 500 times.
I have never been in collections personally. I have had LTD Financial call me trying to get me to pay a debt I didn't owe--wrong person yet they persisted. I handed them their arses back on a platter....even had the President's Office of Citibank ream the collector out about calling me. That was FUN.
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