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How to talk to your collections agency

Dealing with debt collectors can be a nightmare. Not only must consumers suffer through the endless, nagging phone calls, but the impact of overdue debt on your credit score could cause lasting financial woes. As a resident of the District of Columbia, you do have a large number of rights related to consumer debt. Today, we will help you learn how to exercise those rights to improve your financial future and rebuild your credit.

It is first important to remember that consumers who hold overdue debt can work not only with the third-party collections agency, but also with the original lender who first issued the line of credit. If you are having difficulty paying your bill and need some form of debt relief, consider consulting your original creditor first. If the debt is less than six months old, it is likely that you will be able to formulate a plan with this agency. Older debts generally are sent to collection agencies. Both of these entities have the power to modify payment requirements, ensuring your continued ability to work toward repaying the debt.

Understanding the process behind debt collection can also give you some leverage during negotiations. Did you know that most collections agencies only have a short amount of time to recover debt from their accounts? Primary creditors farm out these accounts for only a few months at a time. If the agency cannot collect, the account returns to the original lender. For this reason, your debt collection agency is going to want to work with you to obtain as much money as possible. Without your payments, the collections agency could lose critical fees that allow their business to continue.

Even though you might be nervous about talking to your credit collections agent - they are known for being pushy and abrupt - attempting to resolve the debt through communication is often the best decision. Choosing this option may prevent future financial difficulties and even allow you to avoid filing for bankruptcy.

Source: finance.yahoo.com, "6 important things you need to know about debt collectors" Michael Bovee, Sep. 03, 2013

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