Collection Agencies; what you should know.

If you have the unfortunate privilege of dealing with a collection agency here are some things you should know:

First, know that you do not have to talk to them when they call you. If you do talk with them, do not let them scare you into sending money. They may try to tell you "This is the last chance you have to pay or we will begin legal action.” A third party collection agency cannot do anything legally against you. Only the actual business attempting to collect or a collection agency that purchased your debt can take you to court to collect.

Collection agencies will often tell you anything to get you to send money. If they call and you have no money simply, tell them you have no money and you will settle with them when you have the money.

When dealing with collection agencies you have to remember with whom you are working. The collection representative will try to act as though they are your friend and they are trying to help you. In some instances, they will even play good cop bad cop between the collector and his or her supervisor. The collector is not your friend.

The collector is usually on commission according to how much money they collect.
Management usually pressures collectors to take action to get dollars, now.


If the collection agency agrees to settle with you for less than you owe:

Record the time and date of whom you are talking and get all the details in writing. Put the record of this conversation in a safe place. You may need it in the future.

If the agency will not give you the details in writing do not send any money

Never let the debt collectors draw automatically from your checking or savings account. and never send a post-dated check.

The most important law to remember is the Fair Debt Collection Practices Act, which places many restrictions on collection activities. The FDCPA only covers third-party collection agencies, not original creditors.
Each state may also have applicable laws regarding such things as telephone harassment.

Pay Yourself First

Want to increase your income? Sure everyone could use more cash. Consider this. Before I discoverd how to do this I never was able to save any money. I always said I would save some of what is left at the end of the month. However, there was never any money left at the end of the month to save because I always was able to find something I did not really need to spend my money on. When I started saving a percentage of my pay before I payed any other bills I found it was very easy to save up a ton of money and pay my bills with ease

Avoid Financial Slavery

Following the adage “an ounce of prevention is worth a pound of cure,” Grant Zweifel spoke to some Slidell High School students recently about the dangers of credit cards. The statement above is from a newspaper in Slidell, Louisiana. The reporter, Anne Lautzenheiser, was writing about one of my recent speaking engagements. I had the opportunity to inform groups of high school students in Louisiana how important it is to avoid credit cards. I know from experience. I have had to pay off massive credit card debt. It is not a pleasant experience. I wanted to show these students that there are ways to accomplish their goals without becoming a slave to some financial institution.

Unless You Are Buying a House, Avoid Borrowing Money

Approximately seven years ago, interest rates for home loans began to drop to some of their lowest rates in history. This sparked a massive real estate boom in the United States. This had a big impact on the nation’s economy. This also caused interest rates to drop on many other types of loans. Consumers could get low or even zero percent interest loans on anything from automobiles to televisions. For several years, retail sales and real estate continued to do very well. Many people were buying everything in site and money was flowing everywhere. This helped companies grow like no other time in history. Unfortunately, there is a down side to all of the lending that was going on. I warned of this several years ago. I said a lot of the economy is artificially inflated and this will come crashing down on the lenders and the consumers when it is pay back time. People were living beyond their means and spending was out of control. Many people made fun of me when I paid cash for everything except for my house. They said, “Why would someone spend cash when you can borrow money so inexpensively and then use your cash as working capital for your business. I remember telling them a rainy day will eventually come and when this happens, I do not want any payments except for my house. Well a rainy day has arrived and it is worse than just a rainy day it is a MONSOON! Now our economy is worse than it was before all of this started when you figure in inflation and high fuel prices. Consumers and companies who used common sense and did not get greedy and borrow money are still doing just fine today. The others are hurting badly or closing their doors. This current credit crunch has caused massive layoffs, job cuts and will probably get worse before it improves. Companies are not hiring and they are not creating many new jobs. I feel that the economic downturn that we are currently in was a result of many people borrowing more money than they could pay back. The bottom line of this story is to save for a rainy day and DON'T BORROW MONEY FOR ANYTHING BUT A HOUSE!