Finance Credit card collections agencies have be.e busier and busier in recent times, as an increasing number of people struggle to make their minimum monthly payments and keep on top of their finances. This article looks at what you can do if your debt is placed in the hands of a collections agency, how to negotiate the debt, and what happens to it. In an ideal situation you should never let your debt get to this stage, and meeting your repayment due date should be a high priority, even if you only pay the minimum amount every time your statement .es around. Unfortunately that is not always possible, and in the current tough economic climate people are struggling. A single missed payment can result in a missed payment fee, which can take you over your limit and activate an over-limit fee. The next thing you know you are nearly $100 over your limit, and you still have not even made the overdue payment. The above example is .mon and has a snowball effect, but the first step is not to stick your head in the sand and ignore it, but to speak to the card provider. This represents your best opportunity to .e to an agreement before the provider brings in the collections people. The .pany may be willing to settle for a lump sum or a guaranteed monthly amount for the next few months. Either way, you should do whatever you can to get your account in order. If you fail to .e to an agreement your rating will suffer and the debt will likely be sold on to a collections agency at a reduced rate, with the remainder being written off. As the collections agency have already paid for the debt (usually at just a few cents in the dollar), the more they can recover from you, the more profit they make for themselves. As a result they often play hardball and threaten to take you to court. Court proceedings however are time consuming and costly and the collections agencies would much rather .e to an agreement with you. If possible, make them an offer to settle the debt in full. It is a good idea to do this in writing, keeping a record of all correspondence and sending letters by registered mail. A good starting point is to offer around 25 percent of the outstanding amount. This sounds low, but the collections agency will still be making a hefty profit, even at this low rate. It is likely that they will refuse your offer and give you a figure that they will accept, and it then an issue of bartering and .ing to an agreement. As time goes by the agency will start to pay less focus to the debt, and stop calling you. They may be be.e prepared to accept a low amount, or may even sell the debt on at a reduced rate to another collections agency, and the whole process begins again. Although this sounds like a way of getting a better deal, bear in mind that all the while your rating will be suffering, and you are running the risk of getting taken to court. A court judgment can seriously affect your future, both in a financial and non-financial sense, so you should never let it get to this stage. About the Author: 相关的主题文章: