Acquiring a payday loan can be as simple as filling out an online application. Paying it back can be slightly more difficult, as interest rates and charges can soon add up. If something happens that prevents you from being able to repay your loan, such as being off work due to illness, or because you have been made unemployed, then things can go really bad, really quickly.
This is when you are likely to get your first taste of debt collection agencies and their staff. Debt collection has been around for as long as one person has owed another person a sum of money. Although technology has changed certain aspects of how we do business, one thing has remained constant, and that is the aggressive nature of debt collecting. In this article, we will be taking a closer look at the debt collecting business, and how you can handle aggressive debt collectors.
The problem with debt collectors is that the more money they collect, the more money they earn. This is why they tend to come off as aggressive when they visit you in order to collect a debt. If you have recently defaulted on a loan, then it is in your best interests to do as much research as you can with regards to your legal rights.
Knowing The Law And The Rules With Regards To Debt Collection
In order to avoid a scenario where you are being bullied into paying money that you can ill afford by an aggressive debt collector, there are some things you can arm yourself with. First of all, it is important to know that every debt collector is governed by what is known as the Fair Debt Collection Act (FDCPA), and this was brought in by the state in order to curb aggressive behavior by debt collection agencies and their staff.
Payday Loans, Easy To Get, Difficult To Get Away From
It is not surprising that defaulting on a payday loan is quite a common occurrence, and this is partly due to the fact that these kinds of financial products are very easy to get. Unfortunately, this ease of acquiring a loan leads to many people getting into financial difficulties, and this is when defaults happen.
What Debt Collection Agencies Can And Can’t Do
Anyone who is thinking about applying for a payday loan needs to know that the lending company is allowed to commence the debt collection procedure in a certain way. This should entail telephone calls and letters that politely remind the debtor that their payment is now overdue. The tone of these communications should not be aggressive in any way, and they have to stop if the debtor contacts them with a Cease and Desist letter.
Defaulting On A Loan Is Not A Criminal Offence
One thing that payday loans companies and debt collection agencies cannot do is to threaten the debtor with imprisonment if they fail to pay. Being in debt is not a criminal offence, and neither will it end up with the debtor spending time in jail. Most debt collectors will use various means in order to get you to pay most, if not all, of the money that you owe. It is not unheard of for debt collectors to use threats of violence and the threat of jail time in order to get what they want, your money. If this happens to you, then you need to remain as calm as possible, avoid inflaming the situation any further, and report the debt collector to the relevant authorities.
As soon as a debt collection agency or lending company starts to bombard you with demands for payment, that is the time when you need to keep calm. The first thing you need to do is to make sure that you keep as much of the emails and letters as you can, between you and the debt collection agency. This also includes making copies of letters and emails that you have sent to them. You could also go one step further, and record all telephone conversations. However, it is better to advise them from the outset that you will only communicate via letter or email.
Privacyrights.org has some excellent advice with regards to recording conversations with debt collectors. “If the collector is verbally abusive when phoning you or engages in other practices in apparent violation of the law, you might want to gather evidence by taping the calls. Such evidence can be invaluable if you file a complaint with the authorities and if you sue the collector. Be aware that in a dozen states including California, you need to obtain consent before taping the call, with some exceptions.” You can read more here:
Ways To Avoid Debt Collection In The First Place
Of course, you could avoid the hassles that come with debt collectors if you can come to some kind of repayment arrangement with your creditors. As soon as you get the first feeling that you are going to have trouble repaying your debts, then speak to the lending company right away, as you may be able to come to some kind of agreement.
If a debt collector is already on the case, then this can also apply to them as well, although they may not like the idea at first. Nevertheless, if you inform them that they can either have a little bit of money or no money, you can be sure that they will take you up on your offer. They will try and hold out for more money, but do not let them try to convince you to pay more than you can readily afford to.
As soon as you realize that your debt collector is becoming aggressive towards you due to an unpaid debt, then seek legal advice. There are some debt charities that can offer you advice on debt, borrowing and how to handle pushy debt collectors. In order to help your case, try and capture some of their behavior on tape if you can, be it video or just audio, as this is something that could be played back in a court of law.
Knowingly Handing Over A Post Dated Check For A Dead Account
Depending on what state you are living in, providing a post-dated check that is linked to a bank account that has been closed can be considered an offence. This is due to the fact that you knowingly passed on a check for a bank account that you knew did not have any money in it. If the bank account was closed after you had received the payday loan, then there is nothing to concern yourself about.
Dealing with debt collectors is not a very nice experience at all, and it is one that is best avoided if at all possible. One step that you can take in order to avoid this experience is to make sure that you manage your finances well enough to pay your monthly commitments.
Being honest with the finance company is another way in which you can spare yourself from a visit by a debt collection agency. This method can help you and the lending company to come to some kind of agreement when it comes to paying back what you owe. After all, they would rather have some money coming in, no matter if it’s just a small amount, rather than none at all.
Plan Your Budget To The Nearest Penny
In order to figure out the amount of money that you have left over at the end of each month, you need to sit down and take a look at how you can prioritize some of your bills. Paying for food, heat and lighting are the most important, as is rent, as all other debts pale into insignificance if you do not have a roof over your head. Making sure that you have paid the bills necessary for a comfortable life means that you will have an idea of how much money you have left for your other commitments. Debts for loans and credit cards need to be bottom of the list, but that is not to say that they are not important, it is just the way it goes. Plus, it is important to remember to try and make a token effort to repay at least a little bit of the outstanding amount each month.
Try And Save As Much As Possible
As soon as you have your list of income and outgoings, it is time to look at ways in which you can make savings in your budget. Food is important; however, if you are spending too much and having to throw rotten food away because it is not eaten, then you might want to consider changing your eating habits. Cutting down on the wasting food is important because it saves you money, and you will also be healthier.
Don’t Bury Your Head In The Sand
Above all, do not ignore a debt. It will not go away, and all you will be doing is storing up more trouble for later on. As soon as you feel that you are in some financial difficulties, communicate with the lending company, because burying your head in the sand is just going to mean that debt collectors start arriving at your door.
Nobody goes out of their way to get into debt, and owing large sums of money is not something that most people want in their lives. That being said, it can be easy for debts to spiral out of control, and that is when things can turn sour. It can be embarrassing for a person to have debt collectors turning up at their front door, and if they are aggressive, then it can be even worse.
Any number of factors can lead to a person being in debt, but that does not give debt collection agencies carte blanche to be aggressive in their pursuit of funds. Knowing and understanding your rights is your main weapon in your armory when the time comes to deal with surely and aggressive debt collection agents.