Dealing With Debt Collectors....No FEAR!

When a debt collector calls, it can be not only annoying, but also a little scary!  But dealing with debt collectors does not have to be something you fear.  Let me show you what to do...

 

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No matter how serious you financial and/or debt situation is, there is  a solution.  DON'T BE AFRAID!

  • Debt collectors are people just trying to earn a living.  

I've been dealing with them for many, many years and most of them are not hard to deal with. If, you know a few things about them.

Usually, the debt they are calling about is one that you owe.

 

Of course, if you can prove that you don't, you can always demand that they "validate" the debt by providing documentation.

The Fair Debt Collection Practices Act (FDCPA) gives us protection from illegal debt collection practices.

Basically, it spells out what a debt collector can and cannot do in attempting to collect debt.  It allows a consumer to question the validity of the debt they are calling about. 

There are also many "credit repair" companies that advocate using the validation process to remove debts from our credit report.

While you should challenge or dispute errors on our credit report, beware of opening a validation dispute on accounts you owe as it might backfire on you!

Unless you can prove beyond a doubt that you never had or have paid the debt with proof in writing, don't send the letter!  Why?

A debt collection company has been retained by the original creditor or the owner of the debt.  Yes, creditors buy and sell debt.  In fact, it is a multi-million dollar business.

Anyway, while a request to validate the debt may work, it could cause the debt collector to become very aggressive in their collection efforts! 

This may include filing a CLAIM, resulting in a SUMMONS, that may lead to a JUDGMENT, which could lead to WAGE GARNISHMENT, LIENS and BANK LEVIES!

 

So, before you "jump into" debt validation...You need to contact the collector, but before you do, get prepared:

1)  First, you'll need a BUDGET:

 Budget Worksheet FREE Download here!This will not only let you know how much (if any) money you can offer to SETTLE the debt and the debt collector will most likely ask about your situation.

2)  Call the collector:

Be calm and respectful! 

Trying to act "tough" or being disrespectful will NOT HELP!

While you'll need to explain your situation, don't "over do it".  The collector may need to submit your settlement offer with some budget information to the owner of the debt or they may be able to discuss and negotiate a settlement right now.

Always ask them what it would take to settle the debt! 

They may come back with, "How much do you have to offer?"  

Say something like, "I don't know, I am barely making it now.  What will it take?"

In negotiations, the person who gives out an amount of money usually loses!

Let's say you owe $5,000  and they say they can settle for $4,000. While that is a nice $1,000 reduction, you should be able to do a little better.  Say something like...

"I just don't have $4,000, but I may be able to could come up with $2,000 if you could give me a little time."  That's it...stop talking...wait for a response.

They may or may not accept, or they might come back with a counter offer.

You're trying to get somewhere around 50%.  Here's a few examples:

Recent Settlements See what we have  done for our clients!

Negotiating a settlement is not easy! (I know!  I've been doing this for about 17 years now!)

If you are successful in negotiation a good settlement, you MUST GET THE AGREEMENT IN WRITING!!!!!!!!!

Let me state that again....NO AGREEMENT IN WRITING....NO DEAL!

If you are unsuccessful, then just tell them that you'll have to get back to them and politely hand up.  They may or may not follow up with you.

FINALLY, the worst thing you can do is to ignore the debt.

If you do, while the account may be pulled back to the owner of the debt and transferred to another collector, it cause the collector to become too aggressive and possibly initiate legal action by the collector!

By dealing respectfully and confidently with the debt and the collector, you may be able to settle the debt or if necessary, just set up payments to repay the entire debt.

Hope this helps!

FREE  Debt Elimination Summary

 

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Tags: illegal debt collection pracitces, mistakes dealing with collectors, garnishment, Oregon debt collection

What to Do if You Receive a Summons for Unpaid Bills

Receiving a summons can be a very stressful situation!  Here's what you should know about a summons and more importantly, what you need to do about it:

It seems like a week doesn't go by that a prospect or one of our clients receives a SUMMONS.

Most of the time, a SUMMONS is delivered to you at home.  But in some cases, it may be mailed by certified mail or delivered to your place of employment.

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Before I explain what you need to do, you need to know why this is happening and what you can do to prevent it in the future!

When you find yourself in a financial hardship due to any number of reasons, most likely, you just can't afford to keep up with the minimum payments due on your credit accounts.

At first, after the creditor doesn't receive the payment that is due, you will get a statement with a warning (along with extra LATE FEES and added INTEREST) telling you how much you need to send in this month to catch up.

When you can't make that payment (and of course, you can't), you may start getting calls from a representative of the company.

I know you would like to explain your situation and would like to get a "little sympathy", but most of the time, the rep just doesn't care.  

I suggest that you either ignore those calls or if you just can't resist, say something like:

"I'm going through a very hard time and just cannot afford to make any payments at this time.  I plan to get caught up in the near future, but for now,  please stop calling me!"

Don't wait for an answer, just HANG UP.

Most likely, the calls will either stop or slow down and now you'll start getting letters.

These letters may threaten to "charge off" your account and turn it over to a debt collector or to an attorney.

This usually happens after 3-4 months of non payment, but sometimes, they may wait 6 months or more.

But, at some time, they will send these accounts to a collection agency or a law firm that deals mainly with debt collection.

Now, you will start getting calls and letters from them.

You can also put a  stop the calls now (before, the original creditor had the right to call you).

This will explain:

STOP Collection Calls Free Sample Letter

If your circumstances don't change, and you can't negotiate a repayment or settlement agreement with the collectors, they may decide to start their "legal options" by filing a claim.

Once the claim (legal claim that you owe the debt) a SUMMONS will be delivered or sent to you.

The SUMMONS is going to say something like:

"You must APPEAR and give an ANSWER to this claim."

Without going into a long explanation, this basically just means that if you don't owe the money the PLAINTIFF is CLAIMING, you (the DEFENDANT), must provide PROOF to the court.  

This must be done in a short period of time (usually 20-30 days from the date of delivery) and it must be in "legally correct form" which usually requires an attorney's help.

Most of the time, you (the Defendant), owes the money, so when you don't give an ANSWER to the court, then the the attorney may apply to the court for a date in order to be awarded a JUDGMENT by DEFAULT.

Before this happens, here's what you need to do....

Even if the summons has been delivered, the creditor (plaintiff) may still be willing to accept a SETTLEMENT or a STIPULATED AGREEMENT:

Debt Settlement

Depending on your particular circumstances, you may be able to negotiate a settlement/reduced payment of the balance.

For example, if you are retired and receiving only Social Security or Retirement benefits as your only source of income, these funds are 100% EXEMPT from any levy or garnishment even if a judgment has been awarded!

If you are disabled, and only receiving SSI and/or Disability Benefits, these are also 100% EXEMPT from any levy or garnishment.

There are several other situations where you may have LEVERAGE to negotiate a settlement.

It's not easy, but very possible.  We do this everyday for many of our clients:

Recent Settlements See what we have  done for our clients!

Stipulated Agreement

If you cannot negotiate a settlement, the law firm may apply to the court for a WRIT OF GARNISHMENT.  

With this, they can GARNISH YOUR WAGES and/or  FUNDS IN YOUR BANK ACCOUNT!  For most people, this would be devastating.

Many times, a creditor (or attorney for the plaintiff), may be willing to agree to a series of payments to repay the debt instead of garnishment.  Of course, by now, the balance is much more due to interest, fees, court costs, etc.

As long as you meet the terms of the agreement, the attorney will not go forward with a garnishment or bank levy.

As you can see, a SUMMONS is serious and you can't ignore it!

I hope this information has helped, but if you feel like you need more information, then click here:

FREE  Debt Elimination Summary

 

 

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Tags: summons, debt collector, stipulated agreement, oregon wage garnishment, Oregon debt collection

"Pay-to Delete", Is This Ethical or Even Legal?

Over the last 15 years, I have come across all kinds of so-called "credit repair" suggestions and/or scams.

One of these is called "Pay-to-Delete".  The basic idea is that if you have an account that is past due, charged off, or in collections, you can offer to pay 100% of the balance in exchange for the creditor or debt collector promising to delete that account from your credit report.

Sounds OK, but also sounds "a little to good to be true". 

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The major crediot reporting bureaes are "for profit" businesses that collect data on all of us about how we use credit.  This includes:

How many accounts/credit cards you have

What type of credit accounts you use

How much debt you have

How you pay...on time, late, etc.

Judgments

Bankruptcy

The credi bureaus, mainly the big three:

Equifax

Experian

TransUnion

 

 

 

 

 

 

Tags: how to stop a wage garnishment, Debt Settlement Services, Oregon debt collection

Don't Be Afraid of Debt Collectors!

22853064975_8c547f714f_m.jpgReceiving a call or letter from a debt collector can be a scary experience. Here's what you need to know and what to do so that you don't have to be afraid:

 

  • Debt collectors (for the most part), are just trying to collect monies owed.  They are not "evil" or "our to get you".  If you follow my advice, you should be able to work with them to resolve your debt problem.
  • Having said that, some (yep, there's always a few) go too far in their debt collection efforts.  I'll show you how to handle this type of collector.
  • No matter how serious you financial and/or debt situation is, there is a solution.  DON'T BE AFRAID!
  • A debt collector can be from an attorney's office.  There are many lawyers that only practice debt collection.  You can work with them as well.
  • Regardless of what a debt collector says, you are not going to jail or have all of your belongings seized or confiscated!

 

You probably already know this, but let me briefly explain the debt collection process:

There are several reason why you find yourself barely able or unable to keep up with your debts.  (For the sake of this article, I'm only dealing with UNSECURED DEBT (credit cards, medical bills, personal loans, etc.) and not SECURED DEBTS (debts secured by the item itself (house, car, etc.)

Having been helping people deal with the stress, frustration and seemingly hopelessness of have too much debt, in about 99% of the time, something like this has cause the financial hardship:

  • Unemployment for a long time
  • Divorce or separation 
  • Trying to make ends meet on a fixed income after retirement
  • Long illness or disability
  • Death of spouse or partner

Using credit cards or credit in general may help in the short term, but when your situation doesn't improve or change over a long period of time, then you get to the point where is is very difficult or impossible to just make the minimum payments!

NOW WHAT?

So when you start missing payments or don't make the required minimum payments due, the calls and letters start!

I'll show you how to put a stop to the calls later, but for now, it is very important that you realize what to DO AND NOT DO, when the original creditor calls or writes.

Unfortunately, the original creditor (Visa, Macy's, Home Depot, etc.) that issued the card or account, has the legal right to call you when you miss payments.  You can do one of two things:

  • Not answer the call (just let all calls go to a recording), or...
  • Answer the call.

While your account is still with the original creditor (and it will be for 3-4 months), you might want to answer at least one call to see "where you are at" with this creditor.

Here's what I mean:

Depending a various circumstances, once you've be delinquent on making payments for a couple of months or more, you may get an offer (usually in the form of a letter), with a reduced payment plan or even a reduced balance settlement that could work for you.  

Let's say that you've been unemployed for about 6 months, used up all (if any) of your savings, and have been using credit cards to make up for the lack of income for things like groceries, gas, or even a cash advance to keep the lights on!

But, GOOD NEWS, you've found a new job and the pay is pretty close to your last job.

One the one hand, this is great!  But, on the other hand, you are so far behind in paying your credit card debt, it looks like there is just "no way" you can catch up!

You really only have a few options:

  • A Debt Management Program
  • A Debt Settlement Program
  • Bankruptcy

Debt Management is a program offered by most creditors, whereby they agree to reduce and/or eliminate interest rates and fees until you get "caught up".  This used to be referred to a Credit Counseling Program.

If you qualify, you will have ONE PAYMENT that is pretty close the total of all the minimum payments that are currently required on all of you cards or accounts.

The problem is that with a Debt Management Program, that payment may be too high for you to be able to qualify.

If you would like to learn more about this and/or see if you qualify, click below:

 

FREE  Debt Elimination Summary

 

If you do not qualify for a Debt Management Program, then you should consider a:

Debt Settlement Program

By now, most or your credit cards and other accounts most likely have been placed with a Debt Collection Agency.

Sometimes the accounts are even sold by the original creditor for "pennies-on-the-dollar" to companies.

Now, these collectors or "debt buyers" will start to contact you by phone and mail.

Whereas before, when your account was still with the original creditor, you could not stop calls, once the account is assigned or sold to a collector, you CAN PUT A STOP TO THESE CALLS! Here's how:

 

STOP Collection Calls Free Sample Letter

 

At this point in the collection process, most likely you will get or can negotiate a SETTLEMENT.

The debt collector who has the account (or the debt buyer) can offer to settle the outstanding debt for less than the full amount.

This can be done in a LUMP SUM or even in several, interest-free PAYMENTS.

Check out some actual settlements we have negotiated for our clients:

 

Recent Settlements See what we have  done for our clients!

 

Once the account has been settled, not only will you be done with this debt, but your credit report/score will start to improve.  

It won't happen over night, but over a relatively short time (3-4 months after settlement), your scores will increase!

 

Finally, if you cannot qualify for a Debt Management or Debt Settlement Program, you may need to seek BANKRUPTCY PROTECTION from your creditors.

The law allows (in certain situations) for someone to basically "start over with a clean slate" through bankruptcy.

While I believe you should try to either take care of your debts through Debt Management or Settlement, if you just cannot do either, then seek the help of a Bankruptcy Attorney!

The attorney will offer you a FREE, Initial Consultation and he/she will explain your options.

As you can see, when dealing with the stressful situation of having too much debt and too little income, you don't have to fear the debt collection process.

But, you just can't "put your head in the sand" and ignore the problem.

There are answers and freedom waiting for you:

FREE  Debt Elimination Summary

 

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Tags: dealing with debt collectors, alternatives to bankruptcy, Credit Card Debt Negotiation, Oregon debt collection

Oregon Debt Collection, Know Your Rights!

oregon debt relief know your rightsThe amount of debt the average American has been estimated to be close to $8,000! If you get behind on paying your debts, get ready to hear from DEBT COLLECTORS!

You must know your rights!

YOU DON'T HAVE TO PUT UP WITH DEBT COLLECTION CALLS!

When you get a call or letter from a debt collector, DON'T ADMIT TO THE DEBT, but instead, get the address of the collection agency.

Write a letter demanding that they know longer call you at home or at work.

Mail by certified mail so that you have proof that they received it.

If they continue to call, report them to your state's attorney general.

IF YOUR DEBT IS A FEW YEARS OLD, MAKE THE COLLECTOR VERIFY IT!

The statute of limitations on unsecured credit card debt varies from state to state.

In Oregon, it is 6 years. 

This means that if the debt has had no payments and/or activity for over 6 years, it must be removed from the credit report and in deemed "un-collectable".

When you request a verification of the debt, the collector must:

  • Stop all collection activities
  • Provide proof of original documentation that you indeed owe the debt

Many times a collector has purchased debts and may or may not be able to verify.  If this is the case, you may not have to pay.

IF YOU ARE RETIRED AND ONLY RECEIVE INCOME FROM RETIREMENT SOURCES, YOU ARE EXEMPT FROM GARNISHMENT OR LEVY.

Debt collectors love to scare seniors and/or retired persons!

If your income is from a State or Federal Pension System and the benefits are automatically deposited in your bank account, the bank must perform a 2 months "look back" if they receive a garnishment request from a collector.

This law went into effect on May 1, 2011.

Unfortunately, this only applies to DIRECT DEPOSITS and not normal deposits.

If you are retired, and only receive retirement income, sit down with your banking contact and see if they will "FLAG" your account in case of a garnishment request.

If they will not, find another bank!

IF YOU ARE FACING A LOT OF UNSECURED DEBT, A COLLECTOR MAY ACCEPT A SETTLEMENT FOR LESS THAN THE BALANCE.

This is called "DEBT SETTLEMENT", and it is done everyday to help people clear up past debts.

Debt Settlement can be done by anyone, but it takes time, patience and experience to get the best settlements.

If you need help in this area, let us know.

Tags: debt collection, stop the collection calls, debt relief in Portland Oregon, Oregon debt collection