If a customer owes your local business money, it's hard not to
feel angry, like you want to do anything possible to get your
money back. But the days of going all out to collect on a debt
over.
The Fair Debt Collection Practices Act, designed to protect
consumers from harassment or intimidation, sets firm limits on
what you can do to collect a debt from a consumer. The federal
debt collections law even prohibits practices that were once
standard, and that you might not consider harassment at all.
Besides, as a local business, you have an even more powerful
reason to be especially careful about legal debt collection
issues. You have something much more valuable at stake than a
lawsuit: your business's reputation in the community.
Legal Debt Collection Best Practices:
There are plenty of articles on the web that lay out in plain
English what the Fair Debt Collections Practices Act says you
can and cannot do. Just to give you some idea of the law's
requirements, here are some of the biggest:
- No telling any third party about the debt (except collection
bureaus, collection agencies, or the debtor's attorney).
- No calling on the telephone 9 pm - 8 am, or calling
repeatedly in a way that is annoying.
- No postcards or envelopes that mention the debt.
- No threats to take actions you cannot or will not really
take, such as seizing property, in the case of an unsecured
debt.
- No misrepresenting yourself (e.g., "Hi! This is the
Publisher's Clearinghouse Sweepstakes. May I speak to John?").
- No paying down the debt with payments the customer has
directed be applied to other debts
Tips and Tricks for Legal Debt Collections:
With all these limits on what you can do to collect a debt,
what can you do legally?
- Speak with the debtor personally on the telephone; most
likely he or she wants to pay but is in over his or her head.
Begin by asking what circumstance has kept him or her from
paying. Offer to set up a repayment plan.
- You should both send letters and make telephone calls. Many
people will only respond to one or the other.
- Document every part of the collections process. Take notes
for each call and keep a copy of each letter. If the debt does
ever go to court, you will have proof you acted legally.
- Look into reporting the debt to credit bureaus. If you can,
and are willing to do it, you can tell the debtor that not
paying will impact his credit rating.
- Best tip of all: hand over the job to a dedicated collection
agency. Small business debt collection services start at as
little as $20 per debt. The fight to get paid is a fight no
business should have to involve itself in.
Unfortunately, debt collections are a part of business. Just
make sure that for your local business debt collection law is
followed to the letter, or legal proceedings may become part of
your business, too.
About The Author: Free debt collection laws information at
http://www.debt-collection-laws.com/
Sunday, September 11, 2005
Saturday, September 10, 2005
Debt Elimination 3
Planning To Achieve Debt Elimination
Once you have started the process of changing your debt mindset
to be against taking on consumer debt, then that is something
you need to continue until it becomes the norm in your life. In
some ways it is like stopping smoking; trying on will power
alone is not enough, you need to get to the source of your
problem and permanently change it. That is why self hypnosis
can be successful with stopping smoking; it reaches the
subconscious mind and re-educates it. With debt elimination, it
is the same; to succeed permanently you need to have changed the
way your mind works, not just consciously, but sub consciously
too.
In parallel to changing your mindset, you need to plan your
debt elimination strategy. This will depend on you precise
financial situation: your level of debt, monthly income,
monthly commitments, overdue debts and so on. So, I cannot make
specific suggestions for your circumstances, just give a few
pointers to what you can do to head down the road to debt
elimination. You may well get some benefit from debt counseling
or financial planning advice at this stage, but that depends on
you.
Your chances of achieving debt elimination within, say, 5
years, will depend a great deal on your own efforts, so if you
can get through this part alone, then that may strengthen your
chances of success.
Budgeting For Debt Elimination
You need to take a long hard look at your present financial
situation and how it is likely to evolve into the future. For
debt elimination to succeed, you need to be in control of your
finances and keep your finger on the pulse all the time.
The starting point should be a list of your monthly outgoings.
If you are unsure of any item, then monitor it for a month to
see. For example, you may not know exactly how much you spend
on food and other items from the grocery stores each month.
Just keep a record of them for a month to see what your monthly
expenditure is, but in the meantime use your best estimate.
You can then compare your monthly outgoings with your net
income, and this will be the basis of your budget as you
develop a plan for debt elimination. You also need to compile a
list of your debts; how much is outstanding, what the monthly
payments are, and what the interest rate is.
As an example, let us say you have a net monthly income of
$2500, and your total outgoings, including debt and credit card
repayments, are $2300. This means you have $200 to spare. With
your new, anti debt mindset, you want to use that $200 spare to
get your most expensive debts cleared first. There is a good
chance it is the credit cards that are most expensive, so you
can target the most expensive credit card ie the one with the
highest interest. You owe $600 on that card, so in 3 months you
can clear it. When cleared, you can move on to the next most
expensive.
Depending on your debt level this could be a long process;
that's why you need to plan it out and see how you will cut
down that outstanding debt level over the coming months and
years. So long as the total debt level is reducing, you are
heading in the right direction.
Also, take a close look at those monthly outgoings. Are you
sure there's nothing that can be cut out or reduced? Of course
there is, unless you've already gone through that process
recently. Be ruthless with this new mindset of yours; it really
is worthwhile, knowing there will come a day when you don't have
to worry about the odd few dollars here and there. Highlight
those budget items that are unavoidable, and make sure you pay
those first every month, or at least have the money earmarked.
If you rank your debts in order of interest rate cost, and go
for the highest first, you can work through them one by one.
Need a morale boost to get you off to a good start? Then choose
the loan with the least outstanding, and clear that first. It
may not be the best financially, but if it gives you that quick
satisfaction, so the sacrifice may be worth it.
Debt elimination is not going to be an overnight happening. You
need to be prepared to plan for a few years. 5 years is always a
good period to plan for in business, and can be too in your
personal life and finances. You may be amazed at the
transformations you can achieve in 5 years. But above all, you
need to maintain that anti debt mindset. After all, that is
what will bring you to the debt elimination pinnacle.
In the next article, we consider what to do if there is really
no spare in your monthly budget.
About The Author: Roy Thomsitt is the owner and part author of
http://www.eliminate-credit-card-debt-now.com
end article.
Learn How To Get Out Of Debt, Using Only The Money You Already Earn And Not A Penny More! Learn how to put all the money you're wasting each and every month (Paying Interest) To Work for You!
Click Here For: Total Debt Elimination!
Once you have started the process of changing your debt mindset
to be against taking on consumer debt, then that is something
you need to continue until it becomes the norm in your life. In
some ways it is like stopping smoking; trying on will power
alone is not enough, you need to get to the source of your
problem and permanently change it. That is why self hypnosis
can be successful with stopping smoking; it reaches the
subconscious mind and re-educates it. With debt elimination, it
is the same; to succeed permanently you need to have changed the
way your mind works, not just consciously, but sub consciously
too.
In parallel to changing your mindset, you need to plan your
debt elimination strategy. This will depend on you precise
financial situation: your level of debt, monthly income,
monthly commitments, overdue debts and so on. So, I cannot make
specific suggestions for your circumstances, just give a few
pointers to what you can do to head down the road to debt
elimination. You may well get some benefit from debt counseling
or financial planning advice at this stage, but that depends on
you.
Your chances of achieving debt elimination within, say, 5
years, will depend a great deal on your own efforts, so if you
can get through this part alone, then that may strengthen your
chances of success.
Budgeting For Debt Elimination
You need to take a long hard look at your present financial
situation and how it is likely to evolve into the future. For
debt elimination to succeed, you need to be in control of your
finances and keep your finger on the pulse all the time.
The starting point should be a list of your monthly outgoings.
If you are unsure of any item, then monitor it for a month to
see. For example, you may not know exactly how much you spend
on food and other items from the grocery stores each month.
Just keep a record of them for a month to see what your monthly
expenditure is, but in the meantime use your best estimate.
You can then compare your monthly outgoings with your net
income, and this will be the basis of your budget as you
develop a plan for debt elimination. You also need to compile a
list of your debts; how much is outstanding, what the monthly
payments are, and what the interest rate is.
As an example, let us say you have a net monthly income of
$2500, and your total outgoings, including debt and credit card
repayments, are $2300. This means you have $200 to spare. With
your new, anti debt mindset, you want to use that $200 spare to
get your most expensive debts cleared first. There is a good
chance it is the credit cards that are most expensive, so you
can target the most expensive credit card ie the one with the
highest interest. You owe $600 on that card, so in 3 months you
can clear it. When cleared, you can move on to the next most
expensive.
Depending on your debt level this could be a long process;
that's why you need to plan it out and see how you will cut
down that outstanding debt level over the coming months and
years. So long as the total debt level is reducing, you are
heading in the right direction.
Also, take a close look at those monthly outgoings. Are you
sure there's nothing that can be cut out or reduced? Of course
there is, unless you've already gone through that process
recently. Be ruthless with this new mindset of yours; it really
is worthwhile, knowing there will come a day when you don't have
to worry about the odd few dollars here and there. Highlight
those budget items that are unavoidable, and make sure you pay
those first every month, or at least have the money earmarked.
If you rank your debts in order of interest rate cost, and go
for the highest first, you can work through them one by one.
Need a morale boost to get you off to a good start? Then choose
the loan with the least outstanding, and clear that first. It
may not be the best financially, but if it gives you that quick
satisfaction, so the sacrifice may be worth it.
Debt elimination is not going to be an overnight happening. You
need to be prepared to plan for a few years. 5 years is always a
good period to plan for in business, and can be too in your
personal life and finances. You may be amazed at the
transformations you can achieve in 5 years. But above all, you
need to maintain that anti debt mindset. After all, that is
what will bring you to the debt elimination pinnacle.
In the next article, we consider what to do if there is really
no spare in your monthly budget.
About The Author: Roy Thomsitt is the owner and part author of
http://www.eliminate-credit-card-debt-now.com
end article.
Learn How To Get Out Of Debt, Using Only The Money You Already Earn And Not A Penny More! Learn how to put all the money you're wasting each and every month (Paying Interest) To Work for You!
Click Here For: Total Debt Elimination!
Debt Elimination 2
The First Step To Debt Elimination
Regardless of your personal and financial circumstances, your
education and your background, the chances are the first step
you need to take in debt elimination has to take place in your
mind. The Western mindset, especially in the US and UK, is
firmly fixed on consumer debt. It is the way you have been
reared in a debt ridden society.
To be realistic, let us assume that total debt elimination is
not practical, nor necessarily desirable, from a financial
point of view. The one major exception is in buying a house.
When you buy a house, very few people are likely to be in a
position to do so with cash. Unless they have inheritance, are
very wealthy, are moving down the house market, or moving from
an expensive to a cheap area, people buying a house will
require a mortgage.
There can be considerable financial gains in the long run from
taking on mortgage debt. Firstly, you have to live somewhere,
so living in your own home is more desirable than renting for
the rest of your life. Secondly, if you are lucky the capital
growth on the house over the years will increase your
underlying wealth, in a way that cannot happen with rented
accommodation, which has the opposite affect. So, let us
assume, for the purpose of this article, that by debt
elimination we mean the elimination of all your consumer debt,
except your home mortgage.
You may well find that, if you can change your mindset to be
against borrowing to feed your consumer desires, that mortgage
will be paid off much sooner than your average contemporaries.
When you reach that stage, then there is every possibility that
your debt elimination will become total, and your mindset will
be so changed that there is never a need to take on any new
debt.
Changing The Mindset To Support Debt Elimination
You are unlikely to find it easy to alter your attitude towards
consumer debt. After all, it is the way you have probably been
brought up, surrounded by easy credit. However, changing that
mindset is both possible and financially desirable; debt
elimination is achievable if you can successfully get through
this first stage in the process.
So, how do you change the way you think about debt? Now, I am
talking purely about consumer debt, not borrowing money to
start or expand a business; about using debt to satisfy your
material desires earlier than you can really afford them.
Business finance can, and often does, justify itself through
increasing your wealth at a faster rate than the interest
charges decrease your wealth.
Consumer debt, on the other hand, is guaranteed to reduce your
financial well being. When you borrow money to spend on
consumable items, such as holidays, and diminishing assets,
such as cars, then your wealth building is undermined; your
assets are reduced over time. That, really, is the key to
altering your mindset to favour the elimination of debt from
your life. You need to:
1. Be aware that consumer debt is not good for your financial
well being. You are increasing the bank's assets, and
decreasing your own, by spending on credit.
2. You need to resent the fact that the banks make money out of
you, when it should be the other way round. It's your hard
earned money we're talking about here.
By giving constant focus to those two things you may develop a
mindset that is shifting towards debt elimination. You can then
give yourself greater strength in your determination by
convincing yourself that, not only is debt elimination possible
in the long term, but it will bring with it many rewards:
1. You will feel financially comfortable and in control; it
really is a great feeling as those around you drown themselves
in debt.
2. Over the years you will accumulate significant wealth
compared to those earning the same amount but whose debt has
always been out of control.
3. You will be able to walk in to a travel agent and pay cash,
or debit card, for each vacation, while the person behind you
in the queue will probably pay by credit card and then struggle
the whole year to pay it off before the next vacation.
4. You will be able to walk into a car dealer and negotiate the
best possible price for a new car as a cash buyer, knowing that
the cash is your own and not the bank's.
5. You will be saving regularly for all your needs, while
paying off your mortgage within the term.
All the while, your wealth will be accumulating, not being
stripped bare by interest charges.
Imagine, in 10, or even 5, years' time, a comfortable financial
life with no pressures. You may not be a millionaire, but beside
your peer group you will be a beacon of financial stability and
growing wealth. It's a long term process, but once you have the
mindset, the journey can become a smooth one, with good planning
and determination. Debt elimination really can be the final
goal.
In the next article I will look at planning to eliminate debt.
About The Author: Roy Thomsitt is the owner and part author of
http://www.eliminate-credit-card-debt-now.com
===============================================================
Learn How To Get Out Of Debt, Using Only The Money You Already Earn And Not A Penny More! Learn how to put all the money you're wasting each and every month (Paying Interest) To Work for You!
Click Here For: Total Debt Elimination!
Regardless of your personal and financial circumstances, your
education and your background, the chances are the first step
you need to take in debt elimination has to take place in your
mind. The Western mindset, especially in the US and UK, is
firmly fixed on consumer debt. It is the way you have been
reared in a debt ridden society.
To be realistic, let us assume that total debt elimination is
not practical, nor necessarily desirable, from a financial
point of view. The one major exception is in buying a house.
When you buy a house, very few people are likely to be in a
position to do so with cash. Unless they have inheritance, are
very wealthy, are moving down the house market, or moving from
an expensive to a cheap area, people buying a house will
require a mortgage.
There can be considerable financial gains in the long run from
taking on mortgage debt. Firstly, you have to live somewhere,
so living in your own home is more desirable than renting for
the rest of your life. Secondly, if you are lucky the capital
growth on the house over the years will increase your
underlying wealth, in a way that cannot happen with rented
accommodation, which has the opposite affect. So, let us
assume, for the purpose of this article, that by debt
elimination we mean the elimination of all your consumer debt,
except your home mortgage.
You may well find that, if you can change your mindset to be
against borrowing to feed your consumer desires, that mortgage
will be paid off much sooner than your average contemporaries.
When you reach that stage, then there is every possibility that
your debt elimination will become total, and your mindset will
be so changed that there is never a need to take on any new
debt.
Changing The Mindset To Support Debt Elimination
You are unlikely to find it easy to alter your attitude towards
consumer debt. After all, it is the way you have probably been
brought up, surrounded by easy credit. However, changing that
mindset is both possible and financially desirable; debt
elimination is achievable if you can successfully get through
this first stage in the process.
So, how do you change the way you think about debt? Now, I am
talking purely about consumer debt, not borrowing money to
start or expand a business; about using debt to satisfy your
material desires earlier than you can really afford them.
Business finance can, and often does, justify itself through
increasing your wealth at a faster rate than the interest
charges decrease your wealth.
Consumer debt, on the other hand, is guaranteed to reduce your
financial well being. When you borrow money to spend on
consumable items, such as holidays, and diminishing assets,
such as cars, then your wealth building is undermined; your
assets are reduced over time. That, really, is the key to
altering your mindset to favour the elimination of debt from
your life. You need to:
1. Be aware that consumer debt is not good for your financial
well being. You are increasing the bank's assets, and
decreasing your own, by spending on credit.
2. You need to resent the fact that the banks make money out of
you, when it should be the other way round. It's your hard
earned money we're talking about here.
By giving constant focus to those two things you may develop a
mindset that is shifting towards debt elimination. You can then
give yourself greater strength in your determination by
convincing yourself that, not only is debt elimination possible
in the long term, but it will bring with it many rewards:
1. You will feel financially comfortable and in control; it
really is a great feeling as those around you drown themselves
in debt.
2. Over the years you will accumulate significant wealth
compared to those earning the same amount but whose debt has
always been out of control.
3. You will be able to walk in to a travel agent and pay cash,
or debit card, for each vacation, while the person behind you
in the queue will probably pay by credit card and then struggle
the whole year to pay it off before the next vacation.
4. You will be able to walk into a car dealer and negotiate the
best possible price for a new car as a cash buyer, knowing that
the cash is your own and not the bank's.
5. You will be saving regularly for all your needs, while
paying off your mortgage within the term.
All the while, your wealth will be accumulating, not being
stripped bare by interest charges.
Imagine, in 10, or even 5, years' time, a comfortable financial
life with no pressures. You may not be a millionaire, but beside
your peer group you will be a beacon of financial stability and
growing wealth. It's a long term process, but once you have the
mindset, the journey can become a smooth one, with good planning
and determination. Debt elimination really can be the final
goal.
In the next article I will look at planning to eliminate debt.
About The Author: Roy Thomsitt is the owner and part author of
http://www.eliminate-credit-card-debt-now.com
===============================================================
Learn How To Get Out Of Debt, Using Only The Money You Already Earn And Not A Penny More! Learn how to put all the money you're wasting each and every month (Paying Interest) To Work for You!
Click Here For: Total Debt Elimination!
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