How to Deal With Aggressive Creditors

Dealing with unmanageable debt is stressful enough on its own, but having aggressive creditors constantly calling demanding payments that you can’t afford makes it even worse. Here are different ways and professional resource to help you deal with creditors to remove their calls while taking care of your debt.

The first thing you should know are that each state has protection laws on what creditors can and cannot do. Here are tips on how to work with creditors lawfully and work towards clearing your debt.

Address the problem
You may want to put your head in the sand and avoid or ignore the situation - waiting for the problem to fix itself or disappear. This is unrealistic and will only worsen the situation and potentially see you forced into a court room and potentially bankruptcy or liens on assets should you have any.

Whilst you don’t want to let creditors abuse you, you don’t want to ignore your creditors’ efforts to contact you through phone calls, letters or other means. Only by addressing the problem will you remove the collection calls and get out of debt. By being proactive and taking steps to work with your creditors you will be in a much better place financially in the long run. This will also help should your creditors be unreasonable and you do end of in court – you can show the court that you have attempted to work with them.

Make a plan
To ensure you have a debt free future, you need to plan for the long term. Create a budget so that you have a manageable repayment plan that you will be able to keep up. As part of your plan, prioritise your debts and work out how to pay off the most urgent ones first – consider debt snowballing.

You need to be willing to negotiate with your creditors about a realistic repayment schedule, based on what you can afford. You don’t need to offer excuses — simply explain the facts (have proof) of your situation and inform them of the steps you will take to make sure you make the repayments.

Once you have drawn up your budget (with supporting documents), send a copy to your creditor(s). At the same time, be sure to mention any foreseeable circumstances that may affect your ability to make payments later on. Be careful to stick to the agreed payment plan. If you don’t, your creditor could take court action against you.

Most creditors have a hardship division which will work with you in creating a new repayment schedule that you can afford whilst chipping away at the debt.

Seek professional help
If you don’t feel confident enough to approach your creditors on your own, consider getting some help. By enlisting a professional, you will have someone on your side, who can give you expert advice specific to your debt and financial situation. A professional debt advisor will take into account all of your circumstances and can help you draw up a repayment plan that will help you avoid going into further debt.

There are numerous free options to assist with this, a great starting point is through a Community Action Agency or a free financial counsellor.

Legal Help
In most situations a Community Action Agency or financial counsellor will be able to provide legal guidance and resource to handle creditors or collection agencies. In unusual circumstances or serious cases of harassment, there are law firms and legal organizations that will provide free bro bono services. Learn more about free legal services and where to get help here.