When you have debts that are overdue, collectors will chase you all day long. They are persistent but you cannot afford to pay the debts. This situation is quite stressful. Even if you are working on something to overcome the debts, this constant stress will disrupt your plans.
This is the reason many people want to know how they can deal with collectors. It is important to mention here that even with overdue debts, you still have rights. And debt collectors are obligated to respect them.
In Canada, many debt collectors can cross their limits. But you can stop them by exercising your rights. These collectors may stress you with daily calls, use threatening language, harass your family and friends when the concern is with you, disturb you at un-Godly hours, and more. All these actions are not allowed and you can report such collection agencies.
Talking to Debt Collectors
If a debt collector is making your life difficult but not in an illegal manner, you can consider communicating with them. However, don’t go in without a plan. Remember that debt collectors are obligated to the agencies they work for and will try to get as much money out of you as quickly as possible.
Unfortunately, they will not care about any other debts and collections agencies you will be dealing with. To prevent creating even more financial problems, you need to plan carefully before you begin a talk with the debt collector.
The first step is to track what you owe and what you own. Figure out how much debt you have and how many collection agencies require them. Compare this with the number of financial resources you have. Your plan should include a way to manage all debts with existing finances instead of focusing on just one. You don’t want to get in talks with the debt collector and lose all your money to one overdue debt. This will solve nothing; only add more overdue debts on the top without you having enough financial resources left.
From here, try the following strategies:
1. Evaluate your situation both debt wise and income wise. You should know why your debt became overdue and why you can’t pay it off immediately. If you know your situation well, you will be able to explain it effectively to the debt collector
2. Be honest with the debt collectors. You should be able to tell them all the events that have led to this situation. It is suggested to start from the beginning so they can understand why you have gradually reached this point. In case your expenses are higher than your monthly earnings, do not hesitate to tell them about this either. In addition, you should indicate to them clearly about any other debts that are overdue.
3. Next, evaluate your debt settlement options
Understanding Your Rights
You may think that the collectors are merely doing their jobs but they are not allowed to take certain actions. Here is what collectors should not do and you can confront or report them for doing so:
1. A debt collector can’t collect any money from you without making a notification in either writing or another reasonable manner.
2. Can’t take legal action without notification.
3. Using prohibited hours to contact you. These hours may vary according to different provinces and territories of Canada.
4. They are not allowed to give false information about you.
5. Can’t communicate without providing identification, mentioning to whom the money is owed, and how much.
6. Can’t demand money without the agency completing the required steps to determine if the person actually does owe the money.
7. Debt collectors are not allowed to contact your family and friends apart from asking for contact or address. They may only do so if the family member or friend has guaranteed to pay the debt or you mentioned them to the agency to discuss the debt situation. In the same manner, they may contact your employer to confirm employment, job title, and address if you have given allowed.
If too many debt collectors are on your trail and you are out of options on how to overcome your financial situation, you can file for bankruptcy. Most of your debts will be cleared without harming your income. In this situation, the debt collectors can’t contact you anymore. However, certain debts may not be cleared. These may include child support, alimony, debts imposed by the court, and more.
Bankruptcy is a last resort to get a relief from debt collectors but it is also a second chance to improve your financial situation. Learn about how it affects your life so you are well-informed when taking this decision.