Here’s how to deal with a creditor: Tell them to shut up, give the finger to the phone, and hang up! No, just kidding, but I know we all think about doing that sometimes. If you have fallen behind on some bills or you have some really old bills that you let go and they insist on calling you 5 years later, remember to always keep your composure. Collection agents and creditors thrive on threatening you, scaring you, or backing you into a corner and trying to get you to think in an irrational manner. NEVER stoop to their level. Depending on the company or agency, they WILL be ruthless at some point. This goes mostly for unsecured debt creditors. Auto loan and mortgage creditors are generally more reputable, because they know that they can just take the car or house away if it gets too bad. Here are five steps to dealing with creditors and collection agencies.

1. Check your credit report. Make sure the debt is yours! You’d be surprised at how many weird things show up on a credit report.
2. Get familiar with everything that the Fair Debt Collection Practices Act that gives rights to consumers and regulates the practices of collection agencies and creditors. From The Wikipedia articles about the FDCPA you’ll find all of the prohibited conduct and conduct required by the collection agents and creditors. Make yourself VERY familiar with what they can and cannot do and know your rights! If they pass any of these boundaries during the phone call, tell them specifically that they are violating the FDCPA and if they continue to do so, you will sue them. Then, end the call. I am serious, DO NOT let these people abuse you. They will try every trick and manipulation in the book to try to get you to do something stupid.
3. Check your credit report. Make sure the debt is yours! You’d be surprised at how many weird things show up on a credit report.
4. If the debt is really old and you truly don’t have the money to pay it back, then try to negotiate with the creditor. They will refuse at first, but if you make it known to them that they can either get something rather than nothing, they’ll eventually budge. If you do come to an agreement for a settlement amount, MAKE SURE that you get the agreement in writing.
5. NEVER give them access to your bank accounts or give them post dated checks. They WILL NOT stick to their promise of taking out the money at intervals. If you owe them $1000 and give them EFT access, they’ll wipe out the entire $1000 the first chance that they get.
6. Make a plan to pay off your debts. If you legitimately owe the money, then make a plan to save enough up to pay the bad debt all in one lump sum. Again, make sure that you get it in writing stating, “this amount is a paid settlement IN FULL”. I’ve heard of collection agencies that say you owe X amount of dollars, you pay the bill, and then six months later they say you owe more for late fees and interest.

Just remember that the ball is in your court. YOU have what THEY want. They’ll try to make you feel bad, make you angry, make you cry, make you feel like a criminal, but remember that you didn’t pay the debt for a reason. You didn’t have the money! Your priorities need to be Food, Shelter, Utilities, Transportation, and THEN paying debt. Never let someone con you into paying a bad debt in a lump sum, and then you can’t pay for the mortgage or rent that month. Don’t even let that scenario cross your mind! It’s not about being deceptive or being irresponsible. I believe you need to pay off old debts, but don’t let them manipulate you, and most of all, don’t let them get you to pay a debt that you can’t afford.