Creditors are eager to work with people who admit
they are in trouble and need some help working things out. They
express their greatest concern, however, over those delinquent
customers who don't stay in touch. You'll find it easier to
gain extensions by approaching the creditor first, before the
late payments hit. By contacting the creditors first, it demonstrates
you care about your financial obligations.
The moment you become aware income will be reduced, begin to
develop a plan to contact those creditors who'll be affected.
First contact should be by phone, since most have 800 numbers,
followed by a letter confirming your phone conversation. As
you continue to convey to creditors from time to time that you
are succeeding in your plan to reduce outgo and increase income
to cover all obligations, most will give you the time needed
to meet the obligation, while at the same time encouraging you
to meet it in the very shortest time possible.
The skilled professionals in collections are honest, sincere
and above all realistic. They have heard every excuse imaginable
and believe very little. They also have, however, a sixth sense
that helps them determine a debtors sincerity in repaying a
debt or obligation.
Attitude is important. If necessary, swallow the pride and acknowledge,
up until now, your poor handling of finances. Stress also that
you are approaching your finances differently now. If you are
using the Institute of Consumer Financial Education's "Money
Instruction Book" or enrolled in an Institute
of Consumer Financial Education classes, explain this to the
creditor and how it is helping you get on top of your financial
Don't make payment
commitments you cannot honor.
Do not tell a collector "what they want
to hear", just to get them off the phone. Remember also,
in addition to getting your financial situation in balance,
your other goal is to keep your credit record from hurtful bruises
as a result of this temporary indebtedness. Collection agencies
also report to credit reporting agencies once an account has
been turned over to them. Your cooperation with them will make
a difference in what, if anything they report to credit reporting