Do I Have to Pay Taxes on Freelance Work?
Freelance taxes and side gig taxes are complicated with so many forms to track and receipts to record. This guide helps you navigate tax season.
We investigate the debt collection process so you can have an idea of what to expect if one or more of your debts gets sent to a collector.
So you miss a monthly payment and swear you’ll get caught up next month. But then life happens and you miss a few more payments. Now you’re worried that the debt will get sent to a collector.
Is there anything you can do to avoid collections? And if it ends up going to a collector, what can you expect?
Fact: Collectors recouped almost $54.9 billion in missed debt payments in 2010 alone.
This information below can help you understand the collection process so you can make the right decisions a you move forward. If your debt is already in collections and you think you may be facing collector harassment, click here to ask for help .
One missed payment doesn’t mean your debt gets sent to a collector. Even with two or three missed payments, you still have time to catch up before the creditor writes your account off as a bad debt.
In fact, it usually takes about six missed payments in a row before a debt gets sent to a collection. When you miss about six payments consecutively:
It’s good to note that if you’re speaking with someone from the credit card company and it’s been a while since you made a payment, ask if you’re talking to the regular account payment department or the collections department – it matters!
Once the debt is with a collector, their first task is to get in touch with you and confirm that you are you – i.e. that they have the correct contact information and you are the holder of that particular debt. This is where the proverbial game of hide and seek usually happens. You dodge the collector and they do everything within their power to hunt you down and get you on the phone for verification.
It’s important to note that collectors are within their right to do certain things you may not really like. They can call your office to talk to a boss or your HR department to verify your identity. They can also call you at work until you actually talk to them and tell them to stop. They can call friends, family, and neighbors to verify your identity.
What they can’t do is tell whoever they talk to anything about your debt. They can only ask the person to confirm that you are you. No details about the amount of debt, how far past due it is or who you owe. Still, even just that minimal level of contact for identity confirmation is going to be at least a little uncomfortable for you.
If and when they get you on the phone and confirm your identity and contact info, they will send you a written “validation notice” within five days stating the original creditor, the amount owed and how to proceed. Now comes more calls to put the pressure on so they can get you to pay the debt.
Collectors can be pretty forceful and stay within the letter of the law. But they can’t make threats, curse you out, use abusive language, lie, tell you that you’re going to jail, or say they’re going take your home or property. All of this is known as collector harassment, and you have a right to fight back against these kinds of practices.
From here, a few different things can happen, depending on the action you decide to take:
Fact: The statute of limitations on debt collection is 15 years. After 15 years of no contact, a debt can no longer be legally collected.
Of course, hiding for a full 15 years isn’t exactly easy – if it were, everyone with a debt in collections would do it. And you’re really risking getting sued. Yes, the collector has to call to verify your identity to begin their process. But failing that, there’s always the option of just filing a suit in court and letting the courts find you.
That’s bad news. Once you get sued, you’ll be on the hook for the debt and have the hassle and expense of going through court. What’s more, once you get into the court system, your property is at risk of being liquidated to pay off your debt. A collector can’t take your property to pay off a debt – unless there’s a court order.
Article last modified on May 6, 2019. Published by Debt.com, LLC