Dealing With Bills That Went to Debt Collections

Most people dread paying their bills, but it’s a part of life. We all try our best to pay our bills on time and to pay them to the fullest extent. However, it’s not always feasible to pay those bills when the company asks for it.

There may be times when bills go unpaid and under the radar. In those cases, those bills will go to a debt collection where creditors do whatever they can to receive your payments.

When do bills go to collections?

There is a standard where unpaid debt cannot reported as delinquent until 30 days pass the due date. Once you hit 180 days after the missed payment, the creditor can sell the debt to a collections agency where the collections agency tries to recoup the losses.

The ramifications of a bill going to collections means several penalties including:

  • constant contact from creditors
  • a sudden decrease on your credit score
  • a negative mark on your credit report up to seven years
  • potential lawsuits for missed payments

Knowing these consequences is intimidating. However, there are several ways to address the debt in collections before it escalates.

First, you need to ask for a validation letter from the debt collected within the first week of the first contact. It gives you details about the debt, what you owe and the information on who is trying to collect.

Next, you should know what is and isn’t allowed under the Fair Debt Collection Practice Act, so you don’t receive harassment from collectors. Finally, you can either pay off the debt or dispute it depending on your situation.

Alternatively, if you are worried about debt collection, you may file for bankruptcy, where debt collectors and debts are discharged according to the chapter you file. If you want to know your options, consult with an attorney.