Christian Debt and Finance Resources, Advice

10 Tips For Dealing With Debt Collections

  • Jason Cabler Celebrating Financial Freedom
  • Updated Nov 09, 2012
10 Tips For Dealing With Debt Collections

Being in debt stinks.

Dealing with debt collectors stinks even more.

But when you know at least a little something about how to deal with debt collectors and the games they play, then you can at least have a little power in the process.

I know many people that have had to deal with unpaid debt, and what a tough experience it can be to deal with the debt collection agencies that use every tactic they can, legal and illegal, to collect the money owed.

Being behind on your bills and dealing with a collection agency is never a pleasant experience.  It’s humiliating and can really sap your mental and emotional energy, dragging you into a despair you never thought you’d have to go through when you incurred the debt in the first place.

When the debt collectors start calling, the first thing you have to tell yourself is that you WILL get through this and you WILL come out better on the other side, so muddle through the process, find a way to resolve it, and move on with your life.  It may not be easy but you CAN get it done.

The next thing to do when the collectors start calling is to realize who you’re dealing with.  Once your debt is turned over to a collection agency, you are typically dealing with bottom feeders at that point, especially if the debt is very old.  These agencies normally buy your debt for pennies on the dollar and hope to collect at least a little something from you to make their investment worthwhile.

In order to do that they will use every tactic they can to hound you into giving them some or all of the money you owe.  They have been known to call incessantly, hurl insults, curse people, yell, scream, contact neighbors and relatives, and anything else they can do to browbeat or embarrass you into giving them some money.

But you have rights when it comes to how debt collectors do their job, and the more you know about how to deal with them the better.  So here are a few tips to help you navigate your way through the debt collection nightmare you might be experiencing:

Don’t Ignore It. If you’re contacted about a bad debt, ignoring it won’t make it go away.  In fact it can make things worse due to additional fees, lawsuits, and additional phone calls.  If you owe the debt, acknowledge it and try to work something out.

Keep Track of All Phone Calls. Write down the time, date, who you talked to, and the details of each call.  This will help you to keep track and stay on top of what’s happening with the account.  You can also document any harassment that may be happening.

Keep Your Emotions in Check. Many debt collectors want to get you angry and emotional to force you into doing whatever you can to erase the debt.  When you get too emotional you are much more likely to make a stupid decision that could cause you even more money and trouble in the long run.  If they start playing emotional games, tell them they can call you back when they are ready to talk rationally, then hang up.

If You Don’t Think You Owe it, Then Dispute It. Request proof of the debt in writing.  If you have any documentation that says you paid off that debt, provide them with a copy.  Never send the original.

NEVER Give Them Access to Your Bank Account. If you work out a payment schedule with the debt collector, NEVER, EVER let them autodraft your checking account for a monthly payment.  They will continually ping your account, and when they see that you have any significant amount of money there, they may drain the account, leaving you with no money and probably a lot of overdraft fees as well.

Only Agree to Pay What You Can Afford. Never agree to a payment settlement you know you won’t be able to meet just to get them off your back.  All that does is delay the pain and you’ll be back in the same situation soon enough.  Only agree to pay what you know you can afford, and no more.

Try to Settle for as Little as Possible. The one thing you have working in your favor with a debt collector is that you can negotiate with them.  They only paid pennies on the dollar to buy your debt so you typically can negotiate them down to sometimes half of what you owe or even less.

Get it in Writing. Whenever you come to an agreement on how much they are willing to take, payment arrangements, and so forth, make sure to get it in writing so that you will have proof later on if they suddenly decide to deviate from that agreement.  Getting it in writing helps to keep them honest.  When you finally do get the debt paid off, make sure to get it in writing that the debt is paid in full and the account is closed.  Keep that piece of paper FOREVER!

If You Get Sued for the Debt, respond to the court immediately, and on the court date take every bit of documentation you have so the court can work something out for you that is fair.  If you don’t respond or show up in court you may end up with a default judgment that could mean your wages would be garnished and bank accounts frozen.

Find Ways to Make Extra Money. There are many ways to earn some extra income that can help you get your debts paid off.  I won’t go into the details here because it could take all day, but you can read this post about how to do that.

Ever had to deal with a debt collector over an unpaid bill? Share your experience below!

Article originally published on Celebrating Financial Freedom. Used with permission.

Dr. Jason Cabler is a Christian personal finance blogger, author, and speaker.  He teaches how to get out of debt and live a debt free lifestyle through his Celebrating Financial Freedom blog and self study course.  His new book How to Budget- The Quick and Easy Guide to Making a Budget That Works is now available.  He can be reached for interviews or  speaking engagements by email ( and can be found on Twitter, Facebook, and Google +.

Publication date: November 7, 2012