When a person is behind with his or her payments and is unable to catch up, the creditor will work to collect payment in various ways. The company may start calling and sending letters, but if these methods are ineffective, it may turn the debt over to a collections agency. This can be overwhelming for a Tennessee consumer who is already juggling significant debt, but there may be a way out, including filing for Chapter 7 bankruptcy.
Collections agencies often employ tactics that can seem harassing and unfair. While there are limits to what they can do, their job is to collect debt, and they will try very hard to accomplish that goal. When a consumer gets that initial phone call, it's important to ensure that he or she has all the information about the debt and also that what the collections agent is saying is accurate.
Even if a person is able to make a payment, it does not necessarily mean that the paid-off debt will come off a person's credit report. It may be appropriate for a consumer to contact the collections agency to ask for a written agreement stating that it will remove the debt for the purposes of improving the consumer's credit. However, this is not the only way to deal with a debt that is in the hands of a debt collector.
Chapter 7 bankruptcy offers relief to overwhelmed consumers who want to deal with their debt in a responsible manner, once and for all. Even if a debt is in collections, filing for bankruptcy will immediately enact an automatic stay, which bars collectors from attempting to collect the debt. This is often a reasonable way for a Tennessee resident to regain his or her financial footing and move forward to a more stable future.