Dealing with debt collection companies and original creditors can be a lot of work, but if you understand the process and what has to be done you can have a successful outcome.
It is not uncommon for settlements on outstanding debt to be resolved as long as the communication is open and there is a lively give and take where each party believes they got what they wanted.
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This is an excellent strategy that you can use to put cash in your pocket to help stabilize your financial situation.
The money that you generate is not for spending on clothes or to be wasted on non-necessity items. This cash is to be used to help you have an emergency fund and some cash to start your debt pay off plan.
Write down the monthly payment for each of the items that apply to your situation:
Car Payment(s)
Mortgage Payment
2nd Mortgage Payment
Credit Card Payments
Department Store Cards
Payday Loans
Home Equity Loan
Other Monthly payments not list.
After you have the total payments you’ll need to contact each and every creditor and ask for a 90 day deferment of your payments. Some might only allow 30 or 60 days.
REMEMBER!!! This money is not to be spent unwisely! Use it to establish your EMERGENCY FUNDS $1,000 and to start your debt pay off plan.
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Do you have un-reasonable debt collectors harassing you?
Are they calling your job, home, neighbors and other family members?
Are they making threats to garnish your wages, put you in jail, or to make you look bad to your family and friends?
Now you can fight back!
This strategy is very simply but rarely used because people are afraid or too busy to do the work that is necessary.
You must prepare a cease and desist letter and send it to them. If the collection agency is very aggressive you should send it Registered Mail. That will give you evidence that they did receive the letter.
You can look online or contact my office for help in constructing a cease and desist letter.
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I stumbled across this technique when I was in court. I go into more detail in my book “How I Beat The Debt Collectors at Their Own Game and Made Them Settle a $4,283.05 Credit Card Account for $500 Cash and I Have The Court Documents to Prove it” I suggest you read it to get more details about what I did.
In short when you go to court or talk to a debt collector over the phone or communicate through the mail, NEVER, NEVER, NEVER admit to owing them
anything. Don’t lie about not owing just say “I DON’T KNOW” this will make them have to prove that you owe the money.
I’ve found from personal experience and from the experience of my clients a large percentage of the debt collectors out there don’t have the proper paperwork to prove that individual’s really owe them the money they are asking for.
So make them prove that you owe the money. They can’t just say you owe…they must prove it.
Check List:
If it’s the direct creditor (not a debt collector):
*Ask for the signed documents with your signature proving that you authorized the transaction.
If it’s a debt collector:
*Ask for the signed documents with your signature proving that you authorized the transaction.
*Ask for documentation proving that they are authorized to collect the debt.
Regardless of if they can provide it or not. Debt Collectors and Creditors don’t like to spend time in court proving they are owed a debt. They want it to go fast. So use this to your advantage to make them settle.
PLEASE NOTE: If they can’t prove that you owe the debt ask for an immediate DISMISSAL of your case. Don’t allow them to keep asking the judge for more time to find the documents. Tell the judge that you have given them the opportunity to provide the documents and that you have to work to support your family and that you don’t have the time to wait for them find what they should have already had before they brought the case.
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10 Things You Should Know Before Dealing With Debt Collectors
- Don’t fall for these commercials promising to eliminate your debt.
- Don’t call a creditor about a settlement if you don’t have money to settle.
- Don’t settle making payments unless its absolutely necessary.
- Don’t trust them with their words, always get it in writing.
- Don’t send a check from your account and never give your account numbers to checking or credit cards over the phone or in the mail when settling an account. Use money orders or cashier’s checks. (UPDATE: some collection agencies require payment by phone due to laws in their state, if so make sure they fax or email an agreement before you make the payment.)
- Don’t forget to put in the memo section of the cashier’s check or money order the account number, paid in full for the specific account you’re settling.
- Don’t forget to include the settlement letter from the creditor/ debt collector (which should be on office company letterhead) with the cashier’s check or money order.
- Don’t forget to send the payment back in the allocated time specified for the settlement. This is a trick that debt collector’s use when they find out you might have more money for them to take. They’ll allow you 10 to 20 days to send payment during that time they are trying to find out if you have more money and if you do they will hope that you’ll miss the deadline.
- Don’t forget to send it certified mail. This will ensure that you have evidence that they received it and by whom if they try to
change the game. - Don’t forget to photo copy the letter, cashier’s check or money order and any other documents pertaining to the settlement and SAVE THE FOREVER!
Because of the new banking laws to protect consumers some collection agencies are waiting 3 to 6 months to totally verify that a payment is 100% completed on settlements because some consumers have been charging back payments to their credit cards and checking accounts.
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Your debt might not be collectible?
Each state has a ‘Statute of Limitation’ if a debt collector hasn’t called you during that period of time you can use this technique to declare the debt voided. They don’t expect you to know about this. You’ll need to check your state laws to find out what the ‘Statute of Limitations’ is in your state. You can look this up online or call us for help looking up the laws in your state. Click here to data.
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