A good place to start to get an overview of claims against you is the debt register. Here you can find information about your unsecured debts, such as credit cards and consumer loans. Remember to double-check that the figures are up to date and correct if you want to get a full overview of your debts.
You can also call the debt collection agencies to get information about your cases. If you are in a situation where you have lost track of several small loans, which do not necessarily appear in the debt register, you may need to call several debt collection agencies to get a full overview.
Read more about debt collection at the Consumer Council.
The first thing that happens if you have an unpaid bill is that you are sent a debt collection notice. You then have 14 days to pay the claim, i.e. the bill, before it is passed on to a debt collection company.
When the debt collection company takes over the claim, they often add interest and fees, then send you a demand for payment, with a minimum deadline of 14 days. Now the debt collection process is under way.
If the claim is still not paid, the debt collection company can take legal action to get the money. This means that they can take the case to the conciliation board, apply to the bailiff for an attachment order if you have something they can seize, or apply for a wage deduction, among other things.
30 days after the debt collection company has taken legal action against you, they may notify the credit reference agencies that you have not paid your bill. You are then on the way to getting a payment remark. But the notice will not become public until 30 days after the debt collection company has reported you.
The most important thing to remember here is that you can contact your creditor at any time and try to reach an agreement. Although it may feel difficult to address your problems, they will usually be resolvable. It is also in the creditor's best interest to work out a payment arrangement with you so that they get their money. Whatever the stage of the process, it is usually always worth getting in touch.
The simple answer is that you have to pay your way out of debt collection. However, if you have lodged a complaint or believe that the claim is incorrect, the creditor must stop the debt collection process. Debt collection is not allowed if there is a dispute between the parties.
Read more about complaining about debt collection here.
For some people, refinancing expensive debts can be the solution out of the collection process to avoid payment defaults. When you refinance, the bank pays your creditors and you get a fresh new loan. If it is a credit card or consumer loan that has gone to collection, you will usually get a better interest rate with refinancing than you had before. This can make it easier to deal with and pay off your new loan.
It is always a good idea to contact the people who have sent you a debt collection notice and see what options you have for finding a solution. If the claim has already gone to debt collection, contact the debt collection company to see what they can offer. It is in the debt collection company's best interest to find a solution together with you, as their goal is to recover the money.
The best way to stop debt collection is to pay the debt. However, if you are unable to pay the debt in full straight away, you can contact the debt collection company to see if they will agree to a repayment plan and if they may be able to reduce the interest rate they charge.
However, if you believe that the claim against you is unreasonable or that you have not received the goods/services you ordered, you can file a complaint. Debt collectors cannot proceed with debt collection until the dispute between you and the creditor has been settled.
There are several reasons why it pays to settle debt collection cases as soon as possible. The first is that the bill gets bigger as soon as it is treated as a debt collection case. Debt collectors add interest and fees as the claim grows bigger and bigger.
If you let the debt collection case go even further, you could end up with a payment default. This will create problems for you as your credit score will usually go to 0. This means that you will not be able to apply for a loan, shop on credit, take out subscriptions or insurance, etc.
If you don't have the funds to pay off your collection debts, refinancing with mortgage security may be a solution. The bank will pay off your creditors, leaving you with a new loan with all your debts in one place. We will also set up a payment plan with you. In this way, you can pay off your debts without having to worry about payment defaults or foreclosure.
This article is part of the category Economic first aid , a collection of articles that deal with topics related to a strained economic situation, such as reminders and collection, payment notices, garnishments and forced sales. Read more about Financial first aid
