Receiving contact from a collection agency can be confronting, but it doesn’t have to add insult to injury. We understand that being in debt can be stressful and overwhelming, but it doesn’t have to be. The team at United Debt Assist can work with the debt collection agency to resolve your accounts and move forward.
What does a debt collection agency do?
A debt collection agency is a business that specialises in collecting on money owned, otherwise known as debt, to another person or company. This debt often comes in two forms: contingent and purchased debt. Contingent debt is when a company collects debt for another business, on their behalf. Purchased debt is when a company purchases debt from another business, meaning that they legally own the debt moving forward, and you are now indebted to them.
If you receive contact from a debt collector, here are some tips to make the process a little bit easier.
1. Obtain written notice
If your debt has been purchased by a collection agency, you will have received a Notice of Assignment letter 30 days before they made further contact with you. The notice sets out the amount owed on the debt, along with information on where future payments can be made. Keep this on hand, as it will be useful to reference when working with the collection agency moving forward.
2. Ensure the debt is legitimate, and your own
If a representative from the collection agency has made verbal contact with you, we recommend doing your due diligence and asking the following questions.
– Name and direct number of the collector you’re speaking with
– Name of the company the collector works for
– Who they’re collecting money on behalf of, or who the debt was purchased from
– The amount that you owe
– How you can pay off the debt
– The date you started to owe the debt
It’s important to get all of the above information on the debt. If you weren’t aware of the debt, tell the collector that you will call them back shortly, and make sure you look into the debt and ensure that it is legitimate, and your own.
3. Understand your rights
Any reputable, ethical debt collection agency won’t use intimidation or misleading claims to get you to pay the debt. It’s in their best interest to be understanding and empathetic, particularly when dealing with people in hardship.
Collection agencies have highly regulated and specific compliance protocols in place to ensure that they do the right thing by all parties involved. Under the Australian Consumer Law, you have specific rights that collection agencies will face harsh penalties for crossing. For example, they can only contact you between specific hours of the day, and they can’t disclose the name of the debt collection agency they are calling from until you have confirmed your identity.
4. Stay calm
Receiving contact from a debt collector can make people stressful, emotional, and angry. Take a deep breath and try not to let these feelings guide the conversation that you are about to have. A negative response will not help your situation, nor will it make the collection agency stop contacting you.
If you legitimately owe the money and need to start paying it back, there are ways to make the process easier.
5. Keep track of all correspondence
Depending on the state you live in, debt collectors can make contact with you at varying frequencies per week. Keep a record of every phone call, email or SMS you receive from the debt collection agency to help you to keep track of the situation, and to ensure that the agency is being compliant in the debt resolution process. Additionally, request proof in writing when making any agreements or changes to your account with the debt collection agency.
6. Be proactive and find a resolution
Reaching out for assistance can sometimes be terrifying. But it doesn’t need to be. Our team understands that life events happen, and that you may not have had control over them. Instead of feeling helpless, reach out for an obligation free chat regarding your story.
If you can’t pay off the debt in full, we can set up a payment arrangement that wont impact your credit report.
7. What are my options?
An important thing to note is that we can actually negotiate on your debts on your behalf. If you are unable to pay back the full amount you owe, reach out to one of our experienced mediation specialists.
Stick to your budget, stay organised, seek professional opinions and advice, and soon enough, you will feel back in control of your finances. It’s in everyone’s best interest (yours and the collection agency) to find an affordable and sustainable arrangement to repay the debt. We recommend the steps listed in this article to give you the best chance of resolving your debt with the least amount of stress and angst.
At United Debt Assist, we work with people like yourself who have found themselves in debt and need help, but can’t find a way forward. We care about your story, and we don’t judge you based off your current financial situation.
Find out if United Debt Assist is the right solution for you by checking if you qualify for assistance, without damaging your credit score.