Debt collectors help businesses and individuals collect payments for overdue accounts and other debts. If you fall behind in your payments, the person or business to whom you owe money may ask a debt collector to follow-up your account. Sometimes the creditor will sell your debt to another company or independent collection agency, so you will owe the money to the company that purchased the debt.
Expect to be treated with respect
Debt collectors must act within the law when recovering debts. This means they must obey laws that are designed to protect you from misconduct. Under these laws, a debt collector must not:
use physical force or coercion (forcing or compelling you to do something)
harass or hassle you to an unreasonable extent
mislead or deceive you (or try to do so)
take unfair advantage of any vulnerability, disability or other similar circumstance affecting you (this is known as 'unconscionable conduct').
These laws also apply to a debt collector's conduct towards your spouse, partner, family member or other person connected with you.
Remember: while you do not have to put up with unacceptable debt collection practices, any unreasonable behaviour will not affect whether you are liable for the debt.
Don’t ignore debt problems
You should not try to avoid your responsibility to repay your debts. If you do owe money, the best thing you can do is to try and repay it.
If you ignore debt problems:
the amount you owe may increase as you could be charged more interest
your assets could be repossessed and sold
your credit rating is likely to be affected and you may find it difficult to get loans in future
you might be sued.
Negotiating a repayment plan
Talk to your creditors as soon as you feel yourself getting into financial difficulty— it may be possible for you to negotiate an arrangement which enables you to pay off your debt with regular payments that you can afford. It will be easier for creditors to support you to make alternative arrangements if you act sooner rather than later.
Here are some tips to help you negotiate a repayment plan:
Be honest with the creditor or debt collector about your situation.
Be realistic about how much you can afford to pay and when you can make payments—do not forget about your living expenses and your other financial commitments.
Keep making payments you can afford until an agreement is made.
You may have rights to change your repayment plan if you are suffering hardship—check with the Uniform Consumer Credit Code
Do not be pushed to make promises you will not be able to keep.
Ask for any agreements to be confirmed in writing.
Make every effort to honour the agreement.
Record keeping
It is important to keep good personal records about the debt together.
Remember the following tips:
Keep receipts or other records of payment and copies of any letters or emails.
If you have to provide documents, send a copy and keep the original.
Keep a record of all letters and conversations you have about the debt.
Ask for all agreements you make to be confirmed in writing.
