Being in debt can be very stressful and it’s understandable why a lot of people tend to ignore the situation they are in.
While ignorance can be bliss in a lot of cases, I have to stress that ignoring your debt collectors is definitely something you don’t want to do.
It won’t make your debts go away and in a lot of cases, it can land you in a lot more trouble than you initially were in.
Hence, it’s important that you make sure that when you do receive calls or letters from your debt collectors, you address them as soon as you can.
It’s not your fault. Complaints to the Financial Ombudsman have risen this year from 830 to 2,006, so it’s safe to say that you’re not alone.
Deal with your debt today and feel better tomorrow.
Is There any Advantage at All to Ignoring Debt Collectors?
There are only a couple of advantages to ignoring your debt collector and if I’m being honest, neither of them really seem like advantages at all:
- Ignoring your debt collector may grant you some time to be stress-free. If you don’t attend calls or read letters sent to you by debt collectors then, for a limited time, you may be able to make yourself forget how much trouble you’re in. However, as you can probably imagine, this will be very short-lived. Your creditors will eventually start taking actions against you that you won’t be able to ignore, e.g., court action.
- There is a chance that if you keep ignoring your creditors and debt collector, they might eventually give up. However, you need to be honest with yourself and ask, “Is that really going to happen?”
If you owe your creditors a considerable sum, they are not going to stop contacting you until they are reimbursed. If they’ve hired an agency for debts collection, then there’s even a lesser chance of this happening.
A debt collection agency usually gets a percentage of the amount they are able to collect from you. Furthermore, the employees of the debt collection agency even get bonuses depending on how much they collect from you.
Hence, these are very motivated individuals and it’s very unlikely that they’re going to stop contacting you just because you’ve decided to bury your head in the sand.
Don’t worry, here’s what to do
You could get rid of debt collectors by writing off your debt. I’ve put together a 4 question debt calculator which will tell you if you’re eligible:
What Will Happen if I Ignore Debts Collectors?
There are several things to worry about if you’re refusing to communicate with people trying to collect debt from you. I’ve listed some of them below:
- It’s very unlikely that debt collectors will stop contacting you. As I’ve mentioned above, debt collection agents are paid handsomely if they are able to get you to pay up. Hence, you can count on them to be very persistent even if you don’t respond.
- If you fail to respond to debt collection agencies, it’s likely that they’ll keep reporting you to the credit bureaus. This will hurt your consumer credit by a significant amount and your inability to pay your debts will be plain to see in your credit file.
- Your debt will keep growing. If you refuse to contact your debt collector about the debt, interest will keep adding up and your debt will keep increasing.
- You might be missing an opportunity to write off your debt. It’s very understandable for you to ignore calls by a debt collection agency if you are unable to pay off the debt to your creditor.
- However, the important thing that you need to understand is that even if you don’t have the resources to pay off your debt, you have other options to get it settled. You can work with an independent charity to set up a debt payment plan to your creditor that you can afford.
- There are other options as well such as an Individual Voluntary Arrangement (IVA) or a Debt Relief Order (DRO). By ignoring your debt collector, you are robbing yourself of this opportunity.
- There is a chance you may get sued by your creditor. If you keep ignoring letters and calls by debt collection agencies, your creditors have every right to sue you in a court of law.
- If a judgement is passed against you in court, then the debt collection agency may receive the right to seize your possessions or your wages in order to pay for the debt.
- You are missing out on the opportunity to find out if the debt is even valid or not. There are a lot of times when debt collection agencies contact you about a debt that isn’t even yours.
- It’s a very good idea that when this happens that you ask the debt collection agency for information about the debt and find out if it’s even yours or not. A lot of the time, the debt is illegitimate and you can take it up with the Financial Conduct Authority in order to get it cleared.
- You will be unaware of actions that are being taken against you. Hence, you will not be able to prepare for whatever is coming your way. For example, you would be unaware about default notices, court action or a statutory demand from your creditors.
Find your best debt solution
Is all this information starting to feel overwhelming? Don’t panic! I’ve put together a 4 question debt calculator so you can quickly and easily find the best solution for you. Answer the four questions now.
Talking to Debt Collectors on the Phone is Very Upsetting to Me, Is There Any Other Way For Me to Contact Them?
It’s very understandable if you find talking to debt collectors over the phone anxiety-inducing or upsetting. If this is the case then you can inform the agency that you don’t prefer speaking to them over the phone and would like to be contacted in other forms instead.
This could be in the form of letters or via Email. As per FCA regulations, debt collection agencies are bound to accept your request.
If they continue to contact you over the phone after you have specifically asked them not to then you have every right to report them to the FCA or even sue them in a court of law.
What Should I Do If I’m Contacted by a Debt Collector?
If you happen to be contacted by a debt collector, then it’s very important that you communicate. It’s alright if you don’t prefer speaking over the phone but it’s important that you maintain contact in some form with the debt collector and be very transparent with your information. However, before you share any information with the collector, it’s important that you determine whether the debt is legitimate or not.
Once you’ve determined that the debt is valid and that you do indeed owe the debt, then you can start worrying about how to pay it off.
Once it’s established that the debt is yours, you have to be as communicative about your situation as possible with your collector so they are more understanding and give you more leeway.
If you need help paying off your debt then you can contact an independent charity or a debt management company. They will analyse your situation and help you set up a course of action that will help you pay off your debt.
I recommend that you contact an independent charity such as StepChange or Payplan rather than a private debt management company. This is because private debt management companies usually have their own fees while independent charities will be able to help you free of charge.
Once again, I’ll say that just because you are not able to pay off your debt does not mean it’s the end of the road. You have several options that you can explore which can help you become debt-free. You just have to be willing to explore these options and be cooperative with your creditors so that they are more understanding and forgiving in regards to your situation.
Ignoring debt collectors may seem like a very obvious solution and in fact, initially, it might even seem like it works perfectly. However, it’s very important for you to understand that not only is it a solution that doesn’t work for long but it’s also something that can land you in a far worse situation than you were initially in.
If your debt is valid, do everything you can to communicate with your creditors/debt collectors and explore the options you have to reach a settlement.