There are many ways for a debtor to manage their debts while the collectors are coming after payments. Most debt collectors will sometimes take partial payments of the debt if an offer is made. It can be mutually satisfactory if an arrangement is made to settle at least part of the debt. The older a debt is, the lesser the debtor should offer the collector. A debt can eventually become so old that it shouldn’t require much repayment. Once a debt has reached six years and has not been acknowledged and has not even been partially paid then the debt can be classified as statute barred and is unenforceable so you do not have to pay it back. But this is not entirely advisable.
Debts that are disputed will have the collection halted until the dispute is resolved so this practice can actually be used to buy time and get the funds ready to pay the debt. When a debt collector begins correspondence the debtor should always respond since not responding can have very significant impacts on a your credit file. If the debt is defaulted then that negative mark on a credit history can make it very difficult to retain a loan in the future from a traditional lender.
Debt collectors and their methods
Debtors do have rights and they should know them. The debt collectors are not allowed to bully someone and the debtor is protected against being harassed or coerced by the Trade Practices Act. Lenders and collection agencies have to follow strict rules and cannot inform the family, friends or neighbors of the debtor about the debt. The debtor can only be contacted up to three times a week and only up to ten times a months and the debtor should not be contacted in person unless all other contact methods have been exhausted and even then the debtor has the right to refuse a face-to-face meeting.
Find someone to represent you
In such extreme cases it is best for the debtor to have a representative such as a lawyer or a financial counselor as the middle man who will be the only point of contact for the debt collectors. Sometimes a debt can be a mistake and the debt must be investigated. Sometimes it can even be a case of identity theft in which case it might be cleared up by proving one’s identity. If you are a victim of identity theft then you should contact the authorities immediately to make sure that no other debts are being attributed to you.
In any case, the debt collectors must provide an itemised bill of the amount owed along with an explanation of how the debt was calculated if you want to dispute a debt and then you should be able to show any records of payment. If you ever feel that debt collectors are breaking the rules then you always have the right to report them to the ACCC or your local consumer affairs department.