How to Handle Financial Debt and Aggressive Bill Collectors

It’s no secret that the economy is not doing very well. Consumers are feeling the squeeze. Actually it’s more than a squeeze; it’s more like a financial head lock. The cost of living has skyrocketed and unfortunately salaries have not kept up. As a result, many consumers are running into the emotionally draining problem of not being able to meet their financial obligations. Although handling the problem is not easy, there’s no reason for aggressive debt collectors to make it more difficult than it need be. Here’s how consumers can take back some of their power and maintain dignity while doing so.

Difficulty: Moderately Challenging

Instructions

1. Know the state of your flocks (Proverbs 27:23). In other words find out exactly how much you owe and to whom. Create a list of your debt, account numbers, contact information, monthly payout and total outstanding debt. This step might be rather painful so you might need to stop midway through, have a glass of wine to calm your nerves then continue.

2. Divide the list into the needs and wants. Needs are things like rent/mortgage, utilities, insurance, etc. Wants are things like daily Starbucks coffee, dinner out three times a week and Manolo shoes. You must be willing to severely modify or cut out the items on the want list.

3. Decide which ‘needs’ are modifiable. If the financial situation is dire, you will have to have a heart to heart with yourself and your family to decide which needs can be modified. For instance, if you’re living in a house that is way beyond your financial means, maybe its time to downsize. Or, a reliable pre-owned car drives to work just as efficiently as your Escalade. Maybe it’s time to cut the cost of impressing other people.

4. 

   Set up an alternative ‘bill collector’ phone number. Before you begin to call your bill collectors to set up a repayment plan, it would be in your best interest to set up a special phone number just for bill collectors. Do not give them your or your cell phone number. Set up a different number through a service like Magic Jack, which offer Internet phone service for the price of $20 per year (or something equally as cheap). Setting up a designated phone number saves the aggravation answering unwanted calls from aggressive bill collectors. It’s a way of taking back some of your control.

5. Call the creditors and set up a repayment plan. Now that you know the state of your flocks, and have set up an alternate phone number, its time to call the bill collectors to setup a repayment plan.

6. Get all financial agreements in writing. If the debt collector is unwilling to send a letter confirming the telephone agreement, take the onus upon yourself and write a confirmation letter. Include a paragraph in the letter putting the onus back on the bill collector. For example: “This letter confirms the telephone conversation between (list the party names) that occurred on (date and time) whereby we agreed to repayment of outstanding debt (list debt) as follows (insert the repayment terms). Failing to receive written correspondence from (debt collector) to the contrary, the terms and conditions as outlined in this letter shall serve as the blueprint for debt repayment.” This puts the ball back in their court. If they disagree with any of the terms stated, they must get back to you in writing. Be sure to send it via certified mail with a return receipt request.

7. Batten down the hatches. Depending on the amount of your debt and amount of income, it’s going to be a long bumpy ride. However, with determination, consistency and an aggressive persistence, you can get out of debt. Don’t let the news media and outside forces sway you from your determination to get out of debt.

8. Learn from your mistakes. Once you get out of the debt, learn from your mistakes so that you won’t ever have to go through a situation like this again.

Tips & Warnings

• Honor your written and verbal commitments.
• Periodically check the voice mail messages on the ‘bill collector’ phone line to get a chuckle over the aggressive bill collection practices.

Resources

• Magic Jack – The Cure for Huge Phone Bills
• Benefits of Credit Card Debt Relief and Credit Card Debt Management
• Paying Credit Card Debt Creatively
• Practical Money Making - Surviving Recession, Layoffs, Credit Problems,etc.

[sunshine11219]

on 11/6/2008 great ideas and great if people will learn fvron their mistakes