Nobody likes that call. The one that says you owe money, and someone wants to collect on it. For a lot of people, their first impulse is to ignore collection calls. They think the caller is wrong and the debt isn’t theirs, or they don’t have the money, or they feel overwhelmed and embarrassed. This impulse is natural, but whether you owe the money or not, ignoring a collection call is never the right idea. Doing so can set off a chain of unfortunate events that can cost you money and affect your credit for years to come.

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Getting a call from a collection agent isn’t fun, but it can happen to anyone. Whether you receive one of these calls by surprise, or you’re expecting to receive it, there are five things you should do.

  1. Know Your Rights

    The Fair Debt Collection Practices Act (FDCPA) is very clear on the ways in which debt collectors can and cannot contact you. If you are dealing with debt collectors, make sure you research your rights before you answer the phone or return the call. It’s important to remember though that FDCPA does not apply if you own a small business that owes money to another business or person. If a debt collector is harassing you, you may have legal recourse.

  2. Get complete information

    Make sure you understand why you are being contacted. Ask the debt collector for a complete explanation of what you owe and when the debt and any associated fees were incurred. You have the right to request the explanation in writing or via email.
    Laws about how debt collectors can operate vary between countries and even within countries, but it’s always a good idea to write down the date someone called, who you spoke with, and what was said. Also keep a record of any emails or written communication.

  3. If you owe it, and have the money, pay it

    Sometimes people put off paying money, even when they can afford to do so, because of embarrassment, or because they don’t want a business or romantic partner to know that they incurred the debt. If you know you owe the money and you can afford to repay it, do so quickly. The sooner you repay the debt the sooner the calls stop, the less you’ll wrack up in fines, and the less likely you are to harm your credit.

  4. If you don’t owe it, say so

    Debt collectors are often third party companies that have been sold the debt or hired to collect on it. They may be unaware of the specific details of your debt. If there’s a valid reason you feel you don’t owe the money, explain it. The debt collector may still choose to pursue the debt, but sometimes, a professional debt collector knows that his or her resources are better spent pursuing more legitimate debt.

  5. Negotiate new terms

    If you know that you owe the money but you can’t afford to repay it all at once, ask to negotiate new terms. Do not simply make a “good faith” payment and assume that will satisfy the debt collector. Doing so can actually cost you more money. Make sure you fully understand the terms of any negotiation before agreeing to it

Emotional reactions to debt are normal, but don’t let them stand in the way of good practices. If you are receiving calls from debt collectors, you may need to hire help.

For a large debt, working with an experienced lawyer can save you time and even money, as the lawyer can often negotiate better terms than you can on your own. For smaller amounts, consider contacting a nonprofit that specializes in helping consumers with debt collection issues. Make sure any organization you speak to about your debt is legitimate. Whether you choose to solve the problem alone or ask for help, do not ignore debt collection calls.

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