How to Pay a Collection Agency

Dealing with a collection agency is rarely easy and it is certainly never fun. If you ever find yourself communicating with a collection agency, knowing how to handle it will help make your life easier. Working with a collection agency does not always have to be stressful or time consuming.

Instructions

How to Pay a Collection Agency

1

Document all of your monthly expenses prior to speaking to the collection agency. You do not want to be pressured into agreeing to a repayment plan that you will not be able to maintain. Knowing your expenses before getting on the phone will help you avoid making promises that you cannot realistically keep.

2

Get a notebook to be used only when communicating with the collection agency. Start using this immediately and always be sure to document the dates and times you talk to the collection agency along with the name of the agent helping you. Also, be sure to write down any arrangements that are made so that you can reference them quickly in the future.

3

Find out if there is a settlement plan available for you. Some collection companies are willing to reduce the total amount owed if you are able to pay one lump sum or make two or three large payments. If it is at all financially possible try to take advantage of these settlement programs.

4

Insist on making all payments through the mail using personal checks. Some collection agencies will try to insist that you pay using Western Union, MoneyGram, or other bill payment methods that will cost you money. Other collection agencies will encourage you to sign up for automatic payments which could leave you owing overdraft fees if you miscalculate your finances.

Mailing your payments monthly will help you avoid additional fees and using personal checks will help you build a record of your payment history. If you do not have a checking account consider asking a close relative (parent or sibling) to write and mail checks on your behalf.

5

Keep copies of all letters, checks, and documents concerning your collection account filed away in a safe place. Having documents verifying your payment history and debt amount will help you keep track of what you have paid and what you still owe. These documents will also help you if, in the future, your debt is sold to another collection agency or if you need to dispute information on your credit report.