A few months ago I met with a woman who filed a Consumer Proposal in our Guelph office at Hoyes, Michalos & Associates Inc. She was going through a difficult period in her life and had to take some time off work for personal health issues. As a result her credit card bills went by the wayside. She tried her best to keep up with the minimum payments, but when she had to decide between paying her debts or feeding her children, she rightfully made the choice to put her family first. No one should ever sacrifice the well being of their family to try and stop the phone from ringing – which was her primary reason for contacting us
With the collapse of the housing market and the tighter restrictions on financing, many financial institutions are taking quicker steps to rid themselves of overdue accounts by selling them to collection agencies. This woman dealt with a collection agent who called pretending to be a distant relative with a fictitious story that someone in her family was quite ill. The most shocking story I’ve heard is the manager of a quick cash store waiting for someone at their apartment building to try and collect a $300 pay day loan – another reason never to use pay day loan companies.
These organizations receive a commission for any money they collect and they will use extreme and often illegal methods to force a payment from you (regardless of the amount). You can read more on about collection agents on our website.
How do you deal with these pestering, annoying and stressful collection agents?
Option 1 – Talk to the Agency Directly
Try negotiating with them and see if they are willing to work out an affordable payment plan. Unfortunately this is no longer a highly successful method as most companies will give you an ultimatum such as, “we’ll settle for 50% of your debt, but it has to be paid in 10 days.” Even if you owe $1000, trying to come up with $500 at the last minute is not a realistic option.
Option 2 – Ministry of Consumer Affairs
If the calls, harassment and methods for trying to contact you are violating the collection agencies act, then contact the Ministry of Consumer Services and file a complaint. The ministry is responsible for making sure the collection agencies are practicing within the scope of the law.
Option 3 – Discuss your options with a Trustee in Bankruptcy
If the ministry cannot give you the immediate relief you require,then contact a Trustee in Bankruptcy. Your Trustee in Bankruptcy is licensed to administer a Consumer Proposal which is a simple monthly payment plan. A consumer proposal is an offering to pay back a portion of what you owe (typically 30-40% without any further interest and penalties accumulating) over a period of time (maximum of 5 years). It’s a contract that once accepted, gives you protection from your harassing creditors. The phone calls stop and you receive your fresh start.
If a consumer proposal is not the best solution for you, then the alternative may be to consider personal bankruptcy.
Your first step is to pick up the phone and call us toll free at 310-PLAN and arrange for your free initial consultation. Alternatively you can e-mail me any questions or concerns you might have.
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