How to Handle Collection Agencies if You Are Not Working

Handling collection agencies if you are not working requires you to take control of the situation. Paying debts in a timely way is important, but providing for necessities such as food, shelter, and clothing usually is more critical when you are out of work. This means you must clearly communicate your situation to the debt collector, offer to pay only what you can, and stay with that plan until your financial situation improves. It's imperative that you show the debt collector that you are sincere about wanting to pay your debts, but that you will not submit to intimidation.

Instructions

1

Create a monthly budget for all your expenses. List necessities first, followed by bills you must pay, such as your mortgage. Make projections for monthly income, such as unemployment benefits or withdrawals from savings accounts. The amount you have left is what you can afford to pay to debt collectors, even if that amount is just $20 a month for each collection agency.

2

Call each agency attempting to collect from you, or wait for their next phone call. Explain that you want to pay your debt but you simply cannot make significant payments currently because you are not working. Tell the agency you can afford only a small monthly payment until you return to work. Tell the representative what you can afford to pay, and ask if the agency will accept such an agreement. Keep the conversation short and to the point.

3

Send letters to each of the collection agencies recapping the conversations. Make it clear in your letter that your offer is a take-it-or-leave-it proposal, and that you cannot move off of your position because of your unemployment. Request a payment agreement from the debt collector in writing.

4

Consult with a consumer affairs attorney if a debt collections agency refuses to cooperate and files a lawsuit against you. A lawsuit is the only way for the debt collector to force you to pay. Without a lawsuit the debt collector cannot garnish your wages or take money from your bank account. However, a lawsuit may be less likely after you have explained your unemployment situation to the debt collector and offered to pay what you can each month until you are back to work. Don't panic if the debt collector does file a lawsuit. An attorney can file various legal motions stalling a debt lawsuit for months or even longer. That will give you time to focus on finding a job and settling the lawsuit later.