The Do's and Don'ts of Dealing With Collection Agencies

[David A. Szwak]

The do's and don'ts of dealing with collection agencies
http://www.bankrate.com/brm/news/special/19991217a.asp

By Robbie Woliver •
Bankrate.com
Expert advice for dealing with collection agencies

Stay on top of your accounts. A mistake or misunderstanding you are unaware of might end up with a collection agency, but you should never get there through your own inactivity or negligence.
If there's a problem, call the credit or collection agency right away. Have all the relevant information (dates, charges, account numbers, for example) in front of you.
If you are unaware of the problem, have the caller give you all the information they have so you can cross-check with your records before proceeding.
Immediately respond to a letter or phone call from a collection agency.
If an agency calls you, the first thing to do is get the name and phone number of the collection agent making the call.
Familiarize yourself with the Fair Debt laws. Find out if the company calling you is the creditor, represents the creditor or bought your debt from the creditor. If they are the creditor, they are not subject to the Fair Debt Collection Practices Act. Third-party collection agencies must follow the laws. If the collection agency bought the debt, they will be more aggressive.
When you talk to a collection agent, stay calm and reasonable. Do not fly off the handle. If the debt is incorrect, they may not know that. They are just going by information they have on a screen. If you're nasty, they'll be less likely to negotiate. If you're reasonable, they can be as well.
If you are disputing a bill or need to negotiate a settlement, ask the agent who called you, "Can you resolve this for me, or do I need to speak with another person, like a supervisor?" Remember that supervisors have more leeway to negotiate a payment.
Collection is a bartering game; learn to give and take.
You should always be passed on to a supervisor if you request one.
If they won't pass you on to a supervisor, it's a red flag. Call back later.
If you have a legitimate reason why you can't pay (unemployment, illness, etc.) explain it to the collector. He or she should work out a payment arrangement with you.
Be realistic. Don't tell them you're going to send in a payment and then don't. Markowitz insists that this is the most important point. If you make any arrangement, follow through. Don't do it and subsequent contact will leave you with far less room to maneuver.
After you send in a payment, call the agent to let them know. Give the check number and date you mailed it out. Green says to send the payment by certified mail. Markowitz says your canceled check should be enough.
If you dispute the claim, you have to prove it. The collection agency might not have all the information to help you. Put the dispute in writing and send it by certified mail.
If you have continuing problems with a debt collection agency, or if you are being harassed, contact your state's attorney general.
Keep records and receipts; staple receipts to bills; keep receipts and bills in a folder for a year and keep the folder for three years. You never know when you may need them for a really, really nice and friendly collection agent.

Robbie Woliver is a freelance writer based in New York
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-- Posted: Dec. 17, 1999