One of the allures of working with a debt settlement company is the promise that collection calls will stop. Consumers who have fallen behind on paying their credit card bills are often more troubled by the onslaught of calls and letters demanding timely payment than they are with anything else. Unfortunately, to effectively settle your debts on your own or with a debt settlement company you must keep the lines of communication open.
If you research the Websites of a handful of debt settlement companies, you will most likely find one that markets its ability to help you reduce or eliminate collection calls. Coupled with the promise to eliminate your debt for a fraction of what you owe, they seem like a dream solution.
Why They Call
Once you are late on your payments or have stopped paying altogether, you will begin receive calls from creditors. They are, of course, looking for immediate payment. In some cases, if a hardship is involved, they may place you on a special repayment program to get caught up.
After several months the debt is typically charged off and assigned to a collection agency. It’s the collection agency’s goal to recoup as much of what you originally owed as possible. Its compensation is tied to what is recovered so there is a financial incentive to convince you to pay as quickly and as much as possible. This is often the stage where the calls become a bit more frequent and aggressive.
Stopping the Calls
A debt settlement company that promises to stop the collection calls typically sends a “cease and desist” letter to the collection agencies. The Fair Debt Collection Practices ACT (FDCPA) allows consumers to request that all communication regarding the collection of a debt by a third-party debt collector be stopped.
This is a risky strategy in that debt collectors may choose to involve the courts in an attempt to sue and collect on the debts. Since they can no longer call or write you to negotiate options or get a status on your intent to pay, they may feel that this is their only option.
Keep Talking To Them
Keeping the lines of communication open and letting the collection agency know of your intentions to settle the debt will in many cases keep it from spending time and money taking you to court.
This is easier said than done when you have several different debt collectors contacting you several times a day. It is often helpful if you let most of these calls go to voicemail and return them on your schedule. Drafting a script you can use when calling them back can also help you stay on track and prevent you from being pulled into some of the games played by these agencies.
There are debt settlement firms that encourage you to keep in contact with your creditors and will teach you what to say and how to respond to certain questions. They can also help advise you of your rights and refer you to an attorney should the debt collector act outside the bounds of the FDCPA.
