If you are in financial difficulty and having trouble paying your unsecured debts then most advice will say that you ought to inform your creditors (the people you owe money to) as soon as possible and keep them regularly informed of your financial position. From my own experience I disagree with the blanket nature of this advice.
I do think that you should always try and keep a good relationship with your mortgage provider (if you have one) and obviously your monthly mortgage payment needs to be absolutely the last debt that you don’t pay in full. However the situation with unsecured debt is a little less clear-cut.
The idea behind regular contact with your creditors is that because they know what your situation is, they won’t chase you in the same way or carry out extreme measures such as sending debt collectors, issuing default notices or starting court proceedings. This may be true if you have a very minor debt problem or it is going to be resolved very quickly. However if you have an “open ended” problem with no resolution in sight then the creditors are going to put you through their collection/chasing procedures no matter what you do.
People who work in call centres chasing debts are no-doubt ordinary people just like you and I but they are trained (in most cases) to be abrasive and forceful. At a stressful time in your life, dealing with them on the phone can reduce you to tears. Most collection operations rely on the “shouting loudest” tactic to try and get their money and will tell you many lies to try and scare you into giving them money that you haven’t really got. There is no law that says you have to speak to them on the phone, if they need information then it can be provided by letter. If you are being hounded at home then you have a couple of options:
1. Have an answerphone and use it. Don’t answer any calls and when you listen back delete any messages as soon as you recognize that they are a collection agent.
2. Change your number to ex-directory (and no send)
I would stress that my advice here is not the same as just burying your head in the sand. Do write and tell your creditors about any steps that you are taking to resolve the problem, and if you are going to engage the services of a debt management company.
You need the time and space to consider what the solution to all your debt problems is going to be, e.g. selling up, debt management plans, IVA, full and final offers etc. The resolution of the whole problem is not going to be advanced by spending ages speaking to people on the phone whose job it is to humiliate and intimidate you.
Neil
Tags: Debt Advice, debt assistance, Debt Problems, Debt Solutions
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