Dealing with collection agencies is always stressful. Knowing what not to do when dealing with collectors can be as important as knowing what to do. Before you pick up the phone, remember that there are some behaviors to avoid when talking to a representative from your billing agency.
Not Keeping Records
You should keep detailed records of every interaction with a collection agency. This includes phone calls, letters and emails. Every time that you talk to someone on the phone, note the time, date and name of the person that you spoke to. Keep notes about what was talked about over the phone, as well as copies of letters you send to the collection agency. If possible record the call, but always inform the person on the other end that you are recording.
Paying With a Personal Check
If you send off a payment to a bill collector do it with a money order. This will prevent your collection agency from having all your banking information. Some unscrupulous collection agencies will use this information to their advantage and drain your bank account.
Not Getting a Written Agreement
While you might have a case for a verbal agreement if you record a phone call, it is a far better idea to get any agreements you make in writing. If you negotiate with a collection agency on the phone, tell the representative to send your agreement to you through the mail in writing. Do not make a single payment until you have looked over the written agreement.
Ignorance of Your Rights
The Fair Debt Collection Practices Act protects you from abusive, misleading and harassing practices on the part of debt collectors. Note that this act does not cover the original owner of your debt, just third-party collection agencies. When a collection agency violates a provision of the FDCPA you are entitled to $1,000 -- for every violation. These violations can add up quickly, turning the tables on your bill collectors.
By the time your debt enters charge off and is sold to another agency, this collection company has paid pennies on the dollar for what you originally owed. If your debt is on its third or fourth owner, it has been bought for significantly less than the original value. This means that collection agencies will be willing to settle for a fraction of your original debt. Start with an offer of 15 percent of the original debt, but don’t go any higher than 25 percent.
Talking Too Much
It is best not to talk a collection agency if you can avoid it. The best way to communicate with a bill collector is to do it in writing. If you do decide to talk to a bill collector on the phone, do not say any more than you have to. Keep your answers brief and to the point. Do not volunteer information about your financial situation. Again, the best course of action is to not have any verbal communication with the collection agency at all.
Remember: Protect Yourself
When you deal with a collection agency it is important to know how to protect yourself. Don’t give the collectors the upper hand by not knowing what to do when you discuss or deal with your debt. When you know your rights and common pitfalls to avoid, you will be far less worried about your debt.