Anyone may be a debtor at some point in life. This implies that some people would be sent to collect the debt when you fail to pay it within the agreed period. The truth is that seeing debt collectors in your house or business premise, or receiving several calls from them can be irritating. Ignoring debt collectors doesn’t eliminate your debt. What one should do when unable to pay the debt is look for other friendlier alternatives such as getting advice on how stop all legal action the creditor may be taking against you. But if you avoid or ignore the debt collector, you may face the following consequences.
Hurt your credit
One of the things that debtors can’t miss on their credit reports is a collection account. This doesn’t matter whether you respond to your debt collectors on time or not. However, a good chance to explain your problem to the debt collector may occur in special circumstances. Such circumstances may include having dispute over your original debt. Depending on the way you present your case and the nature of your current circumstance, it may be easier to stop debt collection activity.
The fact that you stop paying your debt doesn’t necessarily mean the interest has stopped accumulating. Various factors such as the state law and contract terms you signed with your creditor may have a longer hand in this. Most debt collectors add collection costs and interest to the debt you have. This means even if you won’t be repaying the debt, there are other standing charges. If you don’t take care, your debt could double over a short span. Even if you would fight to stop all legal action from your creditor, you need to keep in mind there is interest and other fees to pay.
Collectors reach out to third parties
Debt collectors are unable to locate the debtors for one reason or another. When the debtor goes hiding, debt collectors start reaching out to their employers, neighbors, workmates and relatives. Most of them will try to get information of your whereabouts from those close to you, but will not disclose your debts to them. In fact, the law disallows debt collectors to discuss financial status of their debtors with other people. Most of the debtors who go hiding don’t know such laws exist. This means they should not suffer harassment from debt collectors especially if they have cooperated in the past before things worsened.
You risk getting sued
If you decide not to communicate or respond to the debt collectors when they reach you, they may just decide to sue you. Most of them attribute silence to ignorance and disrespect. Although you may successfully defend debt collection lawsuit once, it’s not so always. If the court decides to side with the collectors, they may get a leeway to access your bank account or even garnish your wages. However, those who feel their debts are spiraling out of control should seek to know how Aussie Debt Elimination could help them. Click Debt Mediators to get more details.
Debts greatly lower the quality of one’s life and even lower debtors’s self-esteem especially when debt collectors begin to harass them over the unpaid debt. Most debt collectors will get to this point if you show them contempt especially after you have managed to stop all legal action they may be planning to take against you.