Three Ways to Face an Uncollected Debt

Benjamin Franklin said, "Creditors have better memories than debtors." The saying may be true, but debtors don't necessarily forget their debts. A well-intentioned debtor may have a cash flow problem that prevents him from repaying a debt. Faced with limited cash flow, individuals must prioritize the bills they pay until their financial situation improves. When circumstances change and you are ready to face your uncollected debt, there are several ways to go about it.

Acknowledge the Debt

A creditor has a set amount of time to collect an unpaid debt. The collection period is called the statute of limitations. According to Bankrate.com, the statute of limitations for collecting a debt ranges from two years, for a debt owed in connection with an oral contract in California, to 15 years for written contracts in Kentucky, Ohio and Rhode Island. In most states, if you admit to the creditor that you owe the debt, your acknowledgement resets the clock, and the credit or can take collection action against you. At that point, you can try to negotiate a payment plan with the creditor. Acknowledging an old debt is one way to face it.

Pay the Debt

If you have the funds to pay your debt, the simplest way to face an uncollected debt is to pay it in full. Contact the creditor to verify the amount you owe. Pay the amount you owe and get a receipt for payment from your creditor.

Facilitated Contact

If you are afraid of facing your debt, ask someone to facilitate contact with your creditor. Your representative will contact your creditor and explain that she represents a debtor who wants to repay an uncollected debt. The representative can propose a payment plan and get the creditor to agree to accept regular payments from you without revealing your identity. After the creditor commits to a payment plan, your representative will reveal your identity to the creditor so you can repay the debt according to the schedule.

Charitable Contribution

Perhaps you cannot pay an uncollected debt because you don't know where your creditor lives or even if the creditor is still alive. You want to do the right thing and pay your debt, but you can't. If you can't locate your creditor, pay the amount of money you owe to a charity. The charity will welcome the gift, and making the payment will put your conscience at ease.