One of the last things that most people want to do is talk with debt collectors or creditors but, if you find yourself falling behind on your bills and your cell phone is ringing off the hook, it might be a good idea to talk with them because, in many cases, you’ll find that they’re quite willing to work with you.
Below are 8 of the Top Tips for dealing with debt collectors and collection agencies. Enjoy.
1) Whatever you do, avoid drama at all costs. The simple fact is that if you lose your temper you probably won’t get anywhere, so try to stay calm and, if you find yourself losing your cool, ask the representative call you back at another time. Also, you can tell them that when they call back you’d like to record your conversation, something that usually puts them on their best behavior.
2) Make sure to take copious amounts of notes. When you’re on the phone you should either have a pen and paper handy or, if you type fast, a computer or tablet. Take down the name of the person you talk to, the time and date you talked and a good bit about what you discussed. This can help you to take a lot of the emotion out of your conversation and also have a record so that, during their attempts to collect on your debt, you’ll know if the creditor or collector actually broke any local, state or federal laws.
3) If you’re married, stick to any story that you come up with, especially if it stretched the truth a little bit. While the person on the other end of the phone doesn’t really care about why you can’t pay your bills, if you have a hardship situation they might be more inclined to help you get it straightened out. With that in mind, it’s good to be as consistent as possible, especially if you’re married, so that you don’t make any mistakes that cause your debt collector to believe you’re not being truthful.
4) Get everything that you talk about in writing. If and when you come to payment arrangement with your creditor, you definitely should get everything that they agreed to in writing before you pay them a dime. If you don’t, and pay them before anything is written down, it will be your word against theirs and might end up causing more problems than you originally had.
5) Ask as many questions as possible and don’t shy away from asking more. Simply put, the more you know about what your creditor or debt collector is planning, the more you can plan to deal with it.
6) Do your best to deal with creditors, not collection agencies. This one is quite important. If at all possible, trying to take care of everything with your creditors before they send bills to a collection agency. The fact is that even though late payments will negatively affect your credit report and your credit score, if your account is sent to a collection agency it can cause even more damage.
7) Before signing any agreements, know what you can afford to pay. If you can come up with a lump sum to be able to resolve your debt, you can usually negotiate a better settlement. Once that’s done, you can agree on a payment plan but only if you understand the total amount that you will have to pay.
8) Lastly, don’t just read but save all your mail from any creditors or collection agencies. When you get it you should first read it fully, then save it in a special file just in case.
One last note; while there are many companies out there that tell you that can help you to deal with credit companies and collection agencies, most of what they offer can actually be done on your own for much less money.
It would be fun to rack up your credit card bill and go on a shopping spree, but that’s not what I’m advising. As long as you are responsible and pay off your balance each month, it can actually make smart financial sense to use your credit card for everything.
I use my Costco American Express credit card for everything. At 3% back for gas stations, 2% back at restaurants, 2% on travel purchases, and 1% on other purchases, not the cashback from purchases from Costco, that’s a lot of money you’re throwing away. Add in paying your electric, gas, and cable bills with your credit card you imagine how much each month you’ll rack up in rewards dollars, let alone over the course of a year. Don’t believe, take a look at what you currently spend each month on bills and spending money and do the math!
Your Credit Score is Important
Whether you’re just starting out and have no credit, or you’re looking to continue to build your credit due to mismanagement in the past, using your credit card responsibly by paying off the full balance each month will actually help your credit. A solid payment history is reported to credit bureau’s each month, whereas a debit card does not show on your credit report.
Whether it’s making a big money purchase, or simply do not want to carry cash around, credit cards are more universally accepted than even debit cards. Ever try to check into a hotel or rent a car with your credit card, a hold is placed on your checking account for incidentals, and that hold is even higher when using a debit card. Why tie up the money from your bank account when you can use your credit card and the hold will come off in a couple days from your credit account, which can take twice as long to come off with a debit card. Not to mention the rewards you’re getting by purchasing with your credit card…see…
If you find yourself enjoying the seemingly endless credit limit and are spending too much each month and cannot pay the full balance when it’s due, then perhaps going back to a budget with your debit card works better for you. If you’re disciplined though, and want to earn hundreds of extra dollars every couple months just by spending what you normally spend each month, but this time using your credit card, you can enjoy those rewards checks!
If you’re the type of consumer that’s always looking for the best deals you no doubt have seen web services, apps, coupon sites, browser plug-ins and more that will make sure that, before you make a purchase, you always get the best price.
But what about after you make a purchase? What if the price of the product you bought last week drops this week? Sure, if you’re lucky enough to catch that fact you could go back to the store, return the product, and purchase it again at the lower price. Of course that’s a lot of work, time and energy wasted.
Recently however, at the TechCrunch Disrupt conference in New York City, a new service was introduced named Paribus that takes advantage of the low-price policy many retailers already have in place. The best part? It does the checking, and the refunding, automatically.
What the service does, after you sign up, is attach itself to your email accounts and, whenever a receipt is sent to you from a retailer, it scans the receipt and analyzes the content. After that, it starts checking to see if the price of the items you purchased happen to drop in that particular store. It does this for 14 days, which is the typical time frame for getting a refund from a retail establishment for a price drop.
The first drawback that Paribus has is that, as with any service that saves you money, it takes a commission for doing so. Paribus charges 25% of whatever the refund amount is but, frankly, it’s found money and you wouldn’t be getting anything back without the service.
When you consider how most retail stores are pricing these days, using very aggressive, dynamic pricing techniques based on demand and a number of other factors, the service that Paribus offers is more relevant than ever. There’s simply no way that a typical consumer could possibly track all of the price changes on everything that they purchase. Also, applying for a refund takes a considerable amount of time and effort.
When you consider that prices on practically every consumer item being purchased today are changed automatically using algorithms and software, it’s only fair that consumers have a service that uses those same algorithms to get some money back.
There is a 2nd drawback however and, depending on how you feel about online security and identity theft, it’s a big one.
In order to work, Paribus not only needs access to your personal email accounts but also to your credit card number so that, if it finds a difference in price, it can refund your money. If you use it to track your Amazon purchases, it needs to have your Amazon login information also.
Without a doubt that is a lot of trust to put into a web start up company. Luckily, most credit cards, as well as Google and Amazon, have extremely strong anti-fraud and security mechanisms in place.
The most tragic thing about the secret to successful investing is that most people completely overlook it. The secret is simply this; time. If you have money, and plenty of time before you’re going to need it, you can confidently sit through tough times in the market, and even sustained down markets like we’ve had over the last few years.
You can also wait confidently for an upward trend to come back and, while you’re doing it, get some bargain prices on stocks at the same time. In other words, time is definitely on your side. (We believe Mick Jagger would definitely agree.)
The average worker doesn’t take advantage of this time however, especially those in the period of their life when they actually have the longest time between starting work and retiring. A recent study showed that, of consumers between the age of 20 and 29 who have access to employer sponsored retirement plans like a 401(k), less than half actually take advantage of them.
In fact, when it comes to excuses about putting off retirement savings, every single one is fundamentally flawed. Let’s take a look.
Excuse #1: I’m too young to start saving for retirement. Even though a person might have 30 or even 40 years ahead of them before retirement comes around, and might have student loans and other debt that they need to pay off, the fact is that if you can give your money and extra 10, 20 or even 30 years to grow, the difference that it will make in your retirement account is massive. Not only that but saving when you’re younger starts a great habit that will serve you well throughout your life.
Excuse #2:The time is wrong to invest. While this sounds reasonable, especially considering that America is still struggling to recover from its recession, the fact is that there is always going to be a reason to not invest. However, when you look at stocks from companies like Starbucks and General Electric, both of which look like they were in seriously bad shape not too long ago, you can see that this logic is flawed. Even in a recession there are plenty of opportunities to pick up stocks an excellent prices.
Excuse #3: You don’t have enough money to invest to really make it worth it. Most people believe that a small amount of money like $50 a week won’t really do much good but, over 30 or 40 years and with the help of compound interest, that small investment could put an extra $30,000 into your retirement account by the time you’re ready to use it.
Simply put, time is definitely the one factor that can make you truly wealthy and, since it’s also exactly the same for every single person, there’s no reason that you can’t use it to your advantage.
The only thing you have to start doing is start using it today. If you don’t, it ends up working against you in the end.