How to Stand Up To Creditors 06/09/2011
"Life shrinks or expands in proportion to one's courage." ~ Anais Nin
How courageous would you say you are on a scale of 1 to 10?
I gotta tell you from living through a financial meltdown, the courage necessary to stand up for you rights in the face of oppressive credit institutions is great. It's not easy to but it is possible.
But first, a quick story:
I remember one particularly slow afternoon four years ago, I got a call from a representative of American Express. He said, that if I did not pay a minimum of $2,000 on my nearly $22,000 balance, he would be referring my "case" on to their team of attorneys for review.
I didn't know anyone with that amount of money. I was terrified. Everyone I knew, parents included, were broke. I felt trapped in my own misery; young, naive and broke.
That conversation shook me to the core. In fact, I was so distraught that I hung up the phone it began a long battle of suicidal thoughts and depression in my life that lasted a few months.
Reflecting on that dark time is painful to write, even four years later. To think that I wanted to throw my life away because of some scary credit rep. That I would throw my precious life away over $2,000.
Yet this is exactly the type of predatory bullying that occurs every day in the lending and collections industry. Yes, I had a bad experience, yes I was naive. Yes I lived WAY beyond my means and created my own financial woes. And yes I understand that there are true con artists out on the world that run up tremendous amounts of debt and skip out on the bill. I understand the need for collections. At the same time, I felt so trapped and powerless.
Eventually after many sleepless nights after that episode, I had a revelation of sorts. Perhaps you will too. I remember thinking that I had had enough of the bullying. I had enough playing the victim. I decided I was going to fight back. I decided that I was stronger than this situation, that I was powerful enough to dig myself out.
A voice inside me that had been barely audible in the past began to strengthen: "Fight back", it said.
And so that is the question I ask you. How courageous are you? Is there a part of you that whispers to you to stand up and fight back? If you feel that you are being bullied, harassed or forcibly coerced by collection agencies or lenders, it is important that you research what options you have and fight back.
For example, after that dark episode, I began researching how to get creditors to stop calling.
Turns out there are many websites only that provide sample letters to send to creditors that will either stop or dramatically decrease their incessant calls. I eventually succeeded and began to reclaim my freedom.
As for Am Ex? Well, as I researched further, it turns out that the representative used slippery fear-inducing language over the phone. He actually worked for a collection agency that AmEx used to charge off my account. (I know! I know!) But he misrepresented himself as an associate of American Express. Turns out, there were many steps I needed to take first before handing over a dime.
In my research, I found that once you're dealing with a collection agency, the burden to prove that you actually owe the debt rests on their shoulders, not yours. They have to prove many things about you before they can legally collect and if even one detail is incorrect (an address, for example) they cannot legally collect a penny from you.
Which is great if you know this information. It’s unfortunate because the agencies prey on people's guilt about their debt load to get them to hand over money that ultimately proves they owe the total amount, giving the collection agency license to collect in full.
In my research I also found that all communication between you and the lenders or collection agencies must always always always be in writing. This might seem obvious to some but many people (myself included) make verbal agreements with intimidating collection agency reps over the phone without ever asking for the agreement to be made in writing!
Had I handed over that money out of fear instead of holding off and eventually doing the research and standing up for my rights, I would have handed over $2,000 for no reason! (With the possibility of it never actually being applied to the total account balance!)
A little knowledge begets courage. And through courage we can fight back!
So enough about me, what about you? Knowledge is power and good information can empower you to take action when you feel bullied harassed or intimidated by credit institutions.
Here are some ways that you can build up your courage and fight back against harassing creditors and lenders.
Request that all communication be in writing and keep hard copies of all letters sent and received. I was able to dramatically reduce creditor calls by sending cease and desist letters to each agency individually.
Challenge any and all requests for debt collection. The burden to prove that the debt belongs to you is on THEIR shoulders. They must present evidence that they are authorized to collect the alleged balance. You may owe the total amount but write a letter requesting that the agency verify that they are authorized to collect in the first place. There are many shady agencies out there trying to collect debts without proper authorization to do so.
Check for the statue of limitations on debts in your state. Though this varies from state to state, find out the period of time a creditor or collection agency is legally allowed to come after you to collect, before the debt becomes null and void. For example, if the alleged debt owed was from an account that’s seven or more years old, they may not be legally permitted to collect. The account is simply too old. But of course, unscrupulous agencies out there thrive on resurrecting what I like to call “zombie accounts” and bet on your ignorance of the credit laws in your state. Remember: The more they can get you to recoup (legal or not), the more they make! Be sure they have a right to collect in the first place before making any payments.
One resource I found particularly helpful is the Federal Trade Commission website under Consumer Protection.
If you are willing to take the courageous act of researching your rights you can make miracles happen in your financial life. You will feel empowered and strong, able to take on whatever unpleasant events may occur.
You can fight back. It takes courage to wake up and say: “I will triumph over my circumstances.” When you gain knowledge, your courage expands. And when your courage expands, you can make radical changes in your life.