Yes, the current financial climate is gloomy and
threatening: the consumer's debt is mounting, and the
number of cars repossessed and homes foreclosed is
escalating.
And maybe your personal debt is ballooning. Your personal
debt not only impairs your financial future through an
unfavorable credit score, but also plays havoc with your
present everyday living.
Even the minimum payment each month may look maximum to you
with so many other bills that need to be paid. On top of
that, dealing with creditors has become a nightmare due to
the avalanche of phone calls and mails from you debt
collectors.
But it doesn't have to be like that.
Simply learn how to confront your problems and deal with
your debt collectors.
First, you must have the intention to bring your account
current. With the intention comes the determination to
settle your debt at any cost.
Wipe out the most expensive of all your debt FIRST -
which is often the credit card debt. This is because credit
card debt may hurt you more than you can earn. At 24, 25,
or even 29 percent of interest rate, credit card debt may
literally wipe you out financially. In addition, it can
have an adverse impact on your credit score - something you
need to think about long-term.
To overcome credit card debt, you need to set a specific
goal with a specific period to get yourself out of that
debt.
Accordingly, you can break your big mountain of debt into
smaller hills such that you will be able to climb them.
With the right mindset, you may begin to contact your debt
collectors with confidence.
Communication is the most important component in the world
of credit and collection. Without good communication, there
is no solution to your financial problems. Without a
positive relationship with your creditor, there is no way
any meaningful help - in the form of special payment
arrangements - can be extended to you. Communication is the
best option for you to get out of debt. Good communication
demonstrates your sincerity and resolution to get out of
the debt situation. Your debt collectors want to see your
goodwill, not your lament on the difficulties of your
present financial situation. Remember, debt collectors are
immune to all negative conditions. Just staying positive at
all times is the key to good communication with your
creditors.
On the other hand, ignoring your creditors is the worst
possible option you can take, and it will never pay off. In
addition, don't ever make a promise to your creditors that
you know you will not be able to fulfill.
If you have a repayment plan, which has to be realistic,
and all the related documents in front of you, then make
that important phone call.
Take a deep breath, and call your debt collector. The
following is what you should do.
Ask to speak with the person who is actually handling your
account. Give the collector your account number, giving the
impression that you are ready and prepared to settle the
account. The first impression is important.
It is also important to document your conversation, such as
the date and time of the call, the first and last name of
the person, the title, as well as the specific telephone
number to call back.
Document any agreement or arrangement made to show your
sincerity and your concern of your credit. It is important
to create in the mind of your creditor that you are the
person he or she would like to work with.
Negotiate with your debt collector the repayment plan you
propose. Predetermine the bottom line you are prepared to
accept. Keep an open mind to the counter offers from your
debt collector. Negotiate and negotiate until some sort of
arrangement or agreement is reached.
If your debt collector is rude, ask if you should call back
later, and also mention in passing that you would like to
start on a positive note, without getting yourself irate.
Remember, always establish a good rapport during the first
call. Never give more than you can handle. Always follow
through a promise made to your debt collectors. They, too,
have their goals to make. Put yourself in their shoes, and
this is exactly what you should do when dealing with debt
collectors.
----------------------------------------------------
Stephen Lau is a researcher and writer of medical research
for doctors and scientists worldwide. His several
publications include "NO MIRACLE CURES" a book on healing
and wellness, and "HOW TO TEACH CHILDREN TO READ" a book on
reading strategies. He has also created several websites on
health, golf, Zen living, mental depression, and money
management, including the following:
http://www.smartcreditsmartmoney.com
http://www.nomiraclecures.com
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