Five Simple Tips for Controlling Credit Related Debt

Definitely one of the most dreaded phone calls you can ever receive is the one from a credit collection company telling you one of your debts is very much past due and that you need to ‘make some arrangement to pay it as soon as possible’. Not good, to say the least. Whether it’s your overdue student loans, unpaid medical debt or a credit card that got away from you, it’s a phone call that leaves you feeling vulnerable and a bit like a loser.

So, before that phone rings, let’s take a look at some tips to avoid it from ever happening.

Tip 1 – Avoid the debt collection company completely by first trying to work out an arrangement with the original credit company. Many times they are quite reasonable, so give them a call before it goes to collections.

Tip 2 – Quit hiding from your debt. Ignoring those letters and phone calls will only lead to worse problems.  One of the first things you should always do is request a verification of the debt to make sure it’s actually yours.

Tip 3 – Do some research. If the collection companies are actually harassing you keep in mind that you do have rights, including the right to not be harassed. The Fair Debt Collection Practices Act was set up to help you, so get in touch with them and know your rights.

Tip 4 – Always keep copies of all your records, receipts and any other info like tax documents that could possibly help you in case the debt collector comes a calling. If you indeed did pay off that medical debt you and you have the documentation proving it you’ll be in a much better place.

Tip 4 – Keep your Social Security or disability money in a separate bank account, since debt collectors can’t touch that money even if you do owe them. 

Tip 5 – Never give your bank info to the collectors. Send payments with money orders and never allow direct withdrawals from any account.

If you can’t avoid debt collection problems you can, by using these tips, at least avoid having them take control of your money while you figure out a solution.

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