Secrets debt collectors don't want you to know
Image Source: Flickr User Michelangelo Carrieri
Getting a call from a debt collector can trigger all sorts of unpleasant emotions. You may be scared, embarrassed or humiliated - and this is so much worse when you have no money to pay. And if collection agents call you at work, it can add job stress on top of the financial woes. But you can fight back against debt collectors – even if you don't have the money to pay your bills. Here are seven secrets that debt collectors don't want you to know.
#1 You can make them stop calling
Debt collectors like to call, call and call again. They will call at work and home. You may be scared to answer your phone. The good news is - you can make it stop. Tell the collector you want them to stop calling you at work and tell them you're not allowed personal phone calls. Then ask for their mailing address and send them a written notice with return receipt as proof and ask them only to communicate with you via US mail and provide your correct address.
#2 They can't do most of what they tell you they can
Often, debt collectors exaggerate the options they have to collect on an unpaid debt. For instance, in North Carolina, most commercial creditors cannot garnish wages. They can't swear out an arrest warrant unless you owe a court fine. And it's very rare that creditors go to the effort of seizing your car (unless it's the creditor that financed the auto) or other assets. That doesn't mean they won't tell you all sorts of monstrous things. Report aggressive and dishonest creditors to the CFPB.
#3 They push for more than they will accept
Many collection agencies buy debt for pennies on the dollar and then try and collect the most they can because it's mostly profit. And for those agencies that are hired to handle debt for another creditor, they get a percentage of what they collect. This commission means they have a great incentive to collect as much as they can as soon as they can. In some cases, if they are collecting on behalf of a creditor and haven't purchased the debt, you may be able to contact the original creditor, work out a deal and cut them out.
#4 You don't have to tell debt collectors anything
Debt collectors thrive on information. The more info they can gather about you, the better they can pursue you for a debt. It's best not to give them what they ask for – you don't have to tell them your social security number or verify it. You don't have to verify your employment information, salary or cell number. In short, you can tell them you can't talk and end the call. They can call you another day, but repeated calling is harassment, and it's against the law.
#5 They may have no legal recourse to collect
In North Carolina, most commercial debt has a statute of limitations of three years. The limit is not from the date you first signed the agreement or took on the debt, but starts ticking from the date of your last payment. If the debt is beyond the statute of limitations, the creditor can't sue you to pursue a judgment or lien to collect. In essence, old debt has no legal “teeth.” But if you pay even a $1 on an old debt, you restart the statute clock. Collectors know this and may try to get you to make a small payment.
#6 You may get a better deal at the end of the month, quarter or year
Because most businesses run their finances on a calendar month (including collection agencies), the end of the month is when bonuses are usually calculated. They may be willing to take a low ball offer to bump up their commission for the month. The collection agency itself may be more inclined to be flexible on a lump sum payoff at the end of the quarter or end of the year to improve their financial statements before they reset for the year.
#7 They can't “ruin” your credit
One account can't ruin your credit rating. However, if you have debt collectors calling, you are likely struggling and have more than one delinquent account. And many past due accounts can damage your credit. But here's the thing – your credit is probably already taking a beating from the missed payments. And, they can't do anything with the credit reporting agency to make it worse other than continue to report monthly that it's outstanding.
If you have a lot of debts you can't pay and are being hassled by debt collectors, filing a Chapter 7 or Chapter 13 bankruptcy may be the best thing for you. Chapter 13 gives you time to catch up on past due debts while Chapter 7 wipes out most unsecured debts including credit card and medical bills.
To find out how bankruptcy can put an end to debt collections actions immediately and give you the financial fresh start you deserve, contact the law offices of John T Orcutt. Call +1-919-646-2654 for a free consultation with a North Carolina bankruptcy expert. We have offices conveniently located in Greensboro, Raleigh, Fayetteville, Garner, Wilson and Durham.