Contact with Debt Collectors

I agree with others. My sons dad has issues with people but we have found that if you call them with and work out a one time payment deal to pay it off they take that.
I have had one issue of my own with a doctors office that never sent me a bill and then I ended up on collections. I actually didn't even know I owed anything at all and I owed close to $300. I paid the original person I owed vs the collection agency. Collection agency workers make 30% of what they collect, even if it's less than what you originally owed.
On a side note, they aren't all heartless...but think about what they deal with on a daily basis. They hear "I'll mail it to you....I already paid that..." Yelling and crying and such. I have a great friend whose husband works for a collection agency. He's an awesome guy, super sweet, jut trying to make ends meet. Collectors make $11/hr and then 30% of what they collect on. In the scheme of things it's not all that much since 98% of people hang up on them. He has a college degree and with the economy can't get a job anywhere. :(

Yeah, don't send a check. They'll say that they can electronically debit your account, and keep doing it. (and they will, it's happened to me). Send them a money order as it's the safest route. Writing letters to get one in return with how much you owe is definantly the best route. They'll just harass you on the phone...I hvae yet to see one be nice :(

S.,
When paying off the collections, you should get a money order. You can buy them at the grocery store, Walmart, etc. This way the collections don't get your new bank info.

For your HSBC card, I know why its up to $1000. That credit card is carrying a 30% yearly intrest rate! I have one, so I know. So a balance of $300, gets an interest charge of $100 a year. The next year, the balance is $400, so the yearly interest is $120. The second year, the balance is $500, so the interest is $170. If its been a few years, there is your $500+. Plus they are allowed to add collection fees for their time/handling. Just paying the $300 isn't going to work because the interest charges are legit charges. I would try to pay HSBC off as fast as possible.

Good luck
M.

I've never done this so I can't be sure. But it's my understanding that when you settle for a lower amount it is reported as settled and not paid off. If you want to truly clean up your report and increase your score, you should just bite the bullet and pay the whole amount. I know it bites, it really does. I've done this to myself and I could be really unhappy about it. But it's just not worth the frustration. You should just chalk it up to a learning experience and move forward. It doesn't sound like you have a lot of debts hanging over your head. That's a GOOD thing.

Get Dave Ramsays' Financial Peace book from your library. GREAT info for paying off old/bad debt. I wouldn't "le them know" anything ahead of time and once you wake these bad boys up with a payment, they'll be all over you like sharks to blood. Save to pay OFF the smallest first, then get it in writing that this will settle the debt......use a money order. The book will coach you as to how to reduce your debt amount and agree on payoff. Good luck!

Just wanted to mention that you also need to be sure not to tell any of your debt collectors where you work, or they will obtain a garnishment and take the money you owe them directly out of your paycheck. And no, don't send checks - I once had a company agree orally, over the phone, to a payment plan and then take every cent from my bank account once they had a check in their hands.

HSBC is absolutely horrible for any customer service. You may be able to negotiate a lower amount though not $200 or $300. Write them a letter explaining that you would like to negotiate a settlement and ask for details of the amount due. They will have to go back to Best Buy for the info so it may take some time. A lot of collection agencies will offer to settle if you pay in a lump sum. Also, the interest rate of 30% and no payments made means you are paying interest on interest. It is more than $100 a year in interest since the interest is added every month, making the monthly balance higher.
For the other collecotrs, just type up a form letter that you can send to all (of course change the heading) indicating that you have been unable to make any payments but would like to set up a payment schedule for the near future when you expect to be able to make regular monthly payments. Depending on the amount owed, you may be able to setup what you say you can pay vs what they want.

I have seen my sister go thru some of this stuff and I think your best bet would be to wait till you have at least 3/4 of the money they say you owe, then call them and ask for a settlement. Usually they just want to get it over with and will cut back on some of the outrageous fees they have put onto your account balance.

So save up some money...then plead your case about how it only started at $300 (they do have the right to add in interest and penalty fees tho, so be prepared for that) and ask what they can do for you to get it taken care of. If they say you now owe close to a grand I would offer $500 and see if they accept? Be sure to ask for a receipt and a letter stating this account is now paid or closed or whatever...and keep it for your records....also, make it very clear that if you pay over the phone w/ your bank card that you are authorizing a 1 time only withdrawal...some debt collectors are ruthless, you need to keep them on there toes and make sure they know you are someone who checks your bank records thoroughly...and would be very aware if they try to take out more than what you agreed upon.

My sister was having her checks garnished at 1 point...and after months and months I made her call them and see what was going on...turns out they had "accidentally" taken out $1300+ more then what she owed them....then had the gall to tell her she would have to wait till they checked to make sure she didn't have any other outstanding bills before they could give her the $ back!! Ugh...that was a nightmare....they are NOT nice to deal with...that's for sure!

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To the best of my knowledge...

You do owe them the $1,000, not the $300. Remember, you have been accumulating interest and bank charges.

Do not answer their phone calls, do everything in writing.

I've never heard of anyone having problems by sending a personal check, but would recommend using a money order. NEVER do a payment by phone, or authorize them to charge it to another card.

The longer you put them off, the "meaner" and more demanding they will get and the less chance you'll have a settling. Remember to them, some money is better that no money. First figure out how much of a payment you can send them immediately - like tomorrow. Then how much you'll be able to send them in 2 weeks or a month. Then write the letter.

Acknowledge the fact that you owe the $300 and that some interest has accumulated, however, you would like to have a itemized list of these charges. Then state you have been unemployed, but will be returning to work within the next 30 days. I am enclosing a payment of $$, and will send another payment within xxxx. After I return to work, I will be able to set up a payment schedule.

This will also give you some time to get your finances in order and hopefully that inhertitance will come thru.

Good luck, I hope this helps.

Armyofone0508 hit it right on the head. Do not give them a personal check! Money order or cashier's check only! You probably will find yourself having a hard time paying only what is owed. These meanies like to bleed you dry and they will if they can. Some companies on the other hand might feel an occasional beat of their heart and try to work with you on a lower amount to be paid back. Yes, it will show on your credit report as "settled" instead of "paid in full", but I know after fighting for 7 years myself (I tried one of those debt consolidation places and they screwed me huge), my credit is just fine, even with the "settled" on my report. Good luck to you dear.