Did you receive an unwanted call from a debt collector when you were having a hearty meal with your family?
The amount owed? A whopping $15,000.
Your appetite vanishes within a second and your desire for having a delightful conversation with the family ends instantly. The effect of collection calls is like that. They are nerve-racking and agonizing. Can’t help it.
Debt collection agencies are ruthless. They don’t care if the statute of limitations period has run out. They don’t care if you’re having a dinner at home or conducting a business meeting at the office. All they care about is money. They have purchased the debt for pennies on the dollar with the full intention of reaping profits as much as they can.
Don’t panic and change your phone number because that is not the solution. There are several ways to deal with the collection agencies. The right approach can help you to reduce debt collection calls and save money.
What is the right approach?
The right approach is to leave the matter in the hands of a credible debt consolidation company. A good debt consolidation company can help you to repay your bills and handle a collection agency deftly.
How debt consolidation helps you to tackle collection agencies
A debt consolidation company gives you relief from the painful debt burden. They ask you various questions to know about your financial situation in your preliminary discussion. Usually, they ask you these questions in the no-obligation free debt counseling session. Some of these questions are:
- What is your name?
- How many creditors do you have?
- How much do you owe in total?
- Do you have a job?
- Do you follow a budget?
- How much can you afford to pay?
- Are you getting debt collection calls?
After you answer all the questions truthfully, the debt consolidator/debt counselor gets a clear picture of your financial health. He creates a repayment plan keeping your financial situation in mind. He explains the various aspects of the repayment plan and how you will benefit from it. If you don’t like it, he will modify it to suit your current financial life.
Once you approve the plan, the consolidator will ask you to sign the power of attorney form so that he can take the next step as soon as possible.
The real game starts after you sign the requisite documents and start the debt consolidation process officially. The debt consolidator contacts the debt collection agencies and informs them that you have enrolled in a debt consolidation program. Henceforth, they should stop contacting you. If the debt collection agency has any query or message, then they should call the debt consolidation company directly.
So you (the debtor) get relief from the harassing collection calls instantly.
Debt collection agencies want money. The debt consolidator proposes the repayment plan to them and waits for their response. The consolidator knows the industry tricks and tactics very well. They know how to deal with debt collectors. They know what to say and how to convince them. They have a good idea about the nature of debt collectors and how much they’re ready to negotiate. The aim of the debt consolidators is to convince debt collectors for accepting an affordable repayment plan. The debt consolidators don’t sit quietly till they have achieved their goal.
The debt consolidator asks you to start making monthly payments after all the debt collectors have accepted the repayment plan. You have to send only one low monthly payment to the consolidator every month. The consolidator disburses the amount amongst all the debt collectors.
You have to do nothing at all. The debt consolidator will do everything on your behalf. He will also negotiate to waive off late fees, fines, and penalties. He will check if the collection agency is overcharging you or collecting an illegitimate debt. Basically, he will do everything to help you start a new financial life.
Most consumers are afraid of debt collectors because they often threaten to file a lawsuit. The repurcussion of a lawsuit is dangerous. If the debt collection agency wins the lawsuit, then you can lose a lot of things. You can lose a fraction of your wage (usually 25% of your paycheck) due to wage garnishment or the collection agency can impose a lien on your property. Both are bad since you lose a lot money in the process.
When you enroll in a debt consolidation program, the collection agencies receive payments every month. So they give up their plans to sue you even if they are not happy. Lawsuits involve a lot of money. Collection agencies have to appoint an attorney. They have to pay court fees. Plus, cour procedures take a lot of time. Debt collection agencies are more than happy if they can avoid these hassles.
Debt consolidation helps to reverse the growth of your debt and the collection agencies. It helps to reduce interest rates on your outstanding bills and tackle cunning debt collectors simultaneously. You get a structured repayment schedule and mental peace. I have only one suggestion. Be extremely careful when you are choosing a debt consolidation company. Research thoroughly and choose the best consolidation company in town. Check your credit card bill statements to know if the consolidation company is making timely payments to collection agencies. Alternatively, learn about your rights as a consumer. Read the FDCPA laws so that debt collectors can’t harass you.