How to Handle Bill Collectors - Part Three

Negotiating with Bill Collectors

If you do owe the debt, negotiate calmly and in good faith. Because it gives you more time to think, I would try to carry out all negotiations in writing or hire an attorney to do them for you.

This will also give you a paper trail if you have to proceed in court.

Do not be bullied into rushing into an agreement and do not make any payments unless the agreement is in writing.

For example, if the bill collector agrees to take half of the amount you owe as full payment and report the debt paid to the credit bureaus, get it in writing. If the collector won't send you a letter, send him a certified letter accurately stating all the terms of your agreement.

It is not unknown for bill collectors to settle the case with a debtor and then sell the rest of the debt to another collection agency, which will try to collect the unpaid balance. This is why it is very important to have a paper trail.

Zombie Bill Collectors

If you have old debts that have apparently gone away, beware of the zombie bill collectors. They are buying unpaid debts for pennies per hundred of dollars of debt and then trying to harass debtors to pay. Even if they only get a few dollars, they make money.

The problem is that in many cases the statute of limitations on collecting the debt is run.

If you make a payment, you can reopen the statute. The debt can be reported to credit bureaus as freshly delinquent and you can open yourself up to all sorts of problems. Sometimes even saying the wrong thing to one of these guys can be considered an acknowledgement of the debt, allowing them to reopen the statute of limitations.

If you have any old unpaid debt become familiar with the statute of limitations, generally 4 to 6 years, in the state where you live now and, if applicable, in the states you lived in when you ran up the debt.

The best way to handle a zombie bill collector is to refuse to speak to him. Just hang up the phone.

For more information, read part one and part two of this article.