It seems that the motto of credit collection companies is ‘by any means necessary!’ Honestly, you can’t blame them, it’s their job, though we all wish they were a little more humane about it!
The truth is, when you sign on the dotted line and don’t pay, they will be coming after you! That said, here are a few tips – not to avoid paying your debt, but so you are aware.
I do realize that even when you are attempting to make arrangements, collection agencies can be sneaky. I had a situation myself once where instead of deducting the agreed upon amount, the collector withdraw the entire balance. This left me with no money and no recourse. So here are some things you should know…
Pepperoni or Cheese?
When you order a pizza, the pizza shop may have contract with collection agencies where they sell your address via 411 or Lexus Nexus (company used to get information). This can go for any such carry out where they may deliver your food. Yep – legal.
Dispute in December!
The best time to dispute items off your credit report is around the Christmas holiday. Creditors are generally out on vacation and have a certain amount of time where they have to respond. If they don’t respond in that time, then it has to be automatically removed.
Timing is Everything…
Companies have to pay to report your delinquency to the credit report companies. If you pay on the 30th and you brought your account current, most likely it won’t get reported. You are normally reported 30 days AFTER your account is past due.
So, bill due 9/15 + 30 days = 10/15 … got it? Good…now..
You want to ASK – what time of the month do you report to the credit reporting agencies? Is it the beginning, mid, or end of month? Some report as soon as you hit 30 days, 60 days, 90 days past due.
For instance, using the ‘bill due’ example above:
Company reports delinquencies on the 30th of every month
Your bill is due on 9/15 + 30 days = 10/15 DELINQUENT
You would have until 10/29 to catch up your payment before it is reported to the credit bureaus if they report at the end of the month on the 30th. NOW if they report mid-month… you are in trouble!
They Really DON’T Want to Report You…
Believe it or not, they really don’t want to report your past due status to the credit agencies. It’s costs them money each time, credit collection is big business. It’s better to be aggressive about getting people to pay up than to report them.
We’ve all heard people say you have to be 3 months behind to get your car repossessed. Not true. You can go 10 days past due and the lender has the right to repossess your car. You are responsible for the repossession fee, but it is generally included at the end of your loan – no matter how many times your car is repossessed.
You have to check the rules in your state, but in many states the lender doesn’t have to send a letter notifying you of their intent to repossess your car. They really can just come get it!
Knowledge truly is power – make sure you are on top of your monthly payments and IF you fall behind, reach out to your creditors in advance. Try to make arrangements with them until you are able get back on track.
Have you been on the receiving end of a creditors trick to get their money? Tell us what happened!