Facing burdensome debt can happen to anyone in Indiana. There are a range of reasons as to why this might happen. Perhaps a person suffered an unexpected decline in income or job loss. There could have been a medical concern that required hospitalization and extended care leading to the accumulation of major healthcare debt. A divorce, overspending, changes to the economy and other issues can result in people being confronted by fear and constant calls from debt collectors. Addressing this is imperative.
Debt collectors have new options to contact debtors
In the past, debt collectors were limited to phone calls and letters through the mail to contact those who owed money to creditors. A recent change allowed by the Consumer Financial Protection Bureau (CFPB) updates that and allows contact through a variety of other means – some of which will cause consternation to those with hefty debt. Now, the contact can be made through social media outlets like Facebook and Twitter. On Facebook, for example, the debt collector can send the person a private message or ask to be added as a friend. Contact can also be made via text message and email.
There are rules in place that are supposed to protect debtors from harassment. Debt collectors must identify themselves and state why they are making contact. The messages cannot be for public viewing. In addition, when this type of contact is made, the recipient must be given an opt-out to put a stop to it. Still, as with longtime strategies creditors and debt collectors used to try and extract money from people who owed it, they might push beyond propriety, bend the rules or outright break them to try and collect. Creditor harassment takes many forms and this can add to it while simultaneously increasing the stress debtors are already feeling about their financial situation.
Bankruptcy may stop harassment and help with overwhelming debt
There are strategies that can be used to clear many types of debt. One is bankruptcy. For some, Chapter 7 bankruptcy in which assets are liquidated may be preferable as it eliminates unsecured debt like credit cards and medical bills. For others – such as people who own a home they would like to retain – a Chapter 13 repayment plan could be better. Regardless of the circumstances, everyone who owes money and is behind on their payments will receive calls, letters and messages about it. This new rule will add layers to the way people are contacted and even harassed. To cobble together a viable strategy to stop harassing calls and get into a better financial place, having professional advice is a beneficial first step.