Locating the debtor can take many months. After finally reaching the debtor via phone, it’s time for the Debt Collector to get into action. However, before they can begin the collection, they must start off with the “Mini-Miranda” warning; informing the debtor that the call is an attempt to collect a debt and the conversation is being recorded.

Take a step back. What goes on from here can affect the account’s status. The facts of the debt account should determine how you react to the collector. Is the debt entering into collection for the first time? How long has this debt been delinquent since the last payment? Am I about to be sued?

If the account is entering into collection for the first time, the process may be new to you. If your intention is to pay off the debt, kindly inform them of your plans and hang up the phone immediately. During this period, money is tight and paying the collector may be impossible. There’s no need to discuss your intentions any further. If you plan to file bankruptcy, let the collector know and forward your attorney’s contact information.

Before hanging up the phone, the collector will work quickly to keep you on the phone. The longer you’re on the phone, the more personal financial information you divulge. Don’t carry a conversation with them. They are professionals, and by the end of the call, most debtors will authorize a post dated electronic withdrawal to pay the debt in a schedule. The worst thing about this scenario is that most of the time the electronic checks will bounce and it will put them further in the hole by reneging on a contract and they incur return check fees.

If you’re in a position to pay the debt, why not negotiate a little? All debt collectors will accept a reduced amount to get an immediate payment. Chances are your credit rating has already suffered dramatically. Having an account reported as “settled” is narrowly identical to a “paid-in-full” status. A settlement payment releases you from all legal remedies associated with unpaid debts and the chances of being approved for another loan is comparable to as the debt being paid in full.

Even if you had the money to settle with the collector, how do you know if the collector is legally entitled to collect on the debt for the original creditor? Consumers have the right to ask the collector to validate the debt. In the validation period; the collector must present proof that they are contracted by the original creditor to collect the debt, provide accurate accounting on the debt, refrain from reporting the collection account to credit bureaus, and stop all communications until the debt has been validated. In order to successfully request validation, the consumer must submit a validation letter within 30 days of receiving the collector’s initial letter that informs them about the debt.

If the debt has been delinquent for a very long time, it may be the collector’s last attempt to collect the debt before the statue of limitations expires. It is common for consumers to hear from collectors before the debt expires. The collectors are usually aggressive in demanding a payment. If the consumer cannot make that payment, their last resort is to file a lawsuit before the debt expires.

Debts that exceeded its time limit are considered time-barred. Collectors pursuing time-barred debts cannot force payment through the courts. They can only request the consumer to pay the amount. However, collectors can still sue the consumer after the statue of limitations has expired. They can argue that the consumer either; waived the statue of limitations, extending the statues, or re-aged the account. In most cases, the consumer must prove that the statues did in fact expire.

As time passes on delinquent accounts, I recommend that you carefully avoid admitting to owing the debt. This can re-age the debt and start the time period over again. The best advice is to tell the collector, “I don’t know what you’re talking about, and stop contacting me about this debt.” Send them a cease and desist letter requesting that they immediately stop contacting you. Seek the advice of a qualified consumer attorney if the collections don’t end.

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