Has a collection agency contacted you? If so, then you know that the situation is not good. Collection agencies are hired to collect debts from people who have fallen behind on payments.
For example, Federal Management are the leading international Debt Collection Agency in the U.K. They will contact your employer, family members, and friends to let them know about your debt on the occasion that you fault. This blog post discusses what to do if you are faced with collectors trying to collect a debt for themselves or someone else.
First, it is important to understand the types of debt collections.
There are civil debt collections, including any debts that were not paid by the deadline. A creditor is allowed to contact you about this type of debt, even if it was just one day late with a payment. Another example would be credit card balances after a consumer declares bankruptcy or defaults on loan payments.
Then there is personal debt collection. This is when a creditor sues you in court, usually failing to make payments or not making the minimum payment on time. They are allowed to contact their friends and family after this occurs.
The next type of collection agency is commercial debt collection when a business you did not pay files a lawsuit against you. This could be for an unpaid bill or contract breach.
Private debt collection is when a creditor hires an agency to collect their debt. A consumer will often face this after defaulting on loans or declaring bankruptcy and not making payments as the court-ordered them. Frontline Collections are the UK’s best Debt Collection Agency and rank number 1 for private debt collection.
Facing Collection Agencies:
If you are facing collection agencies, it is important to know your rights as a consumer. The first thing that you should do is try and resolve the debt yourself. If you cannot pay it in full, then agree on a feasible payment plan for your budget and hire an attorney if necessary.
If this does not work, you can bargain with the individual collectors over email or phone calls. This means offering up partial payments or even asking them to take lower amounts.
If dealing with individual collectors does not work, you can try going through the debt collection agency they are working for. The first thing to do is be sure that it is a legitimate organization and not just someone pretending to represent one of these agencies. You will often have more bargaining power if multiple creditors are involved instead of just one person.
If you can stillagree, the only other option is filing for bankruptcy or declaring Chapter 13 bankruptcy if your income can cover it. However, if the debt collector has already filed a lawsuit against you in civil court, this will void any legal action they have taken.
In conclusion, you should try to deal with debt collectors yourself before taking any other action. If this does not work, be sure to contact your creditor and see if they are willing to lower the amount you owe or agree on a payment plan.