How to Deal With Past Due Accounts
As soon as you miss a payment your account is considered to be past due. The more that your account becomes past due then the more your lender or creditor will try to get you to catch up on it.
If your account is only a little past due then the collection efforts are not too intense. However, when your account becomes more past due then you will start to receive serious phone calls and letters. When your account is 90 days past due then your credit score will start to take a big hit.
If you have an account that is past due then there are ways for you to deal with it.
Pay The Whole Amount
You are able to get your account back on track quickly by paying the total amount that you owe in order to cover the past due balance in full.
The further you are behind your account then the more the minimum payment will be due to the interest incurred and other fees.
Paying in full will stop your account being charged off and sent to a collection agency.
You may find that you are not able to pay the past due balance in full. You should then contact your creditor and speak to them about spreading the amount over a few months. This allows you the time you need to catch up on the account. You are able to send in extra payments until your account has been caught up.
Negotiate a Pay for Delete
If you are able to pay off the past due balance then you could ask your creditor to re-age the account so that the delinquencies no longer appear. Some creditors will agree to do this especially if it is the first time you have fallen behind on payments.
Consolidate the Account
Your account doesn’t really get paid off when you consolidate it. Instead you shuffle debts around so that they are easier to pay.
When you consolidate the debt your account will become current and this avoids any charge off, but you will have a new debt to pay.
Settle the Account
If it is not possible for you to get back on track then you could consider working out a settlement plan with your creditor. This means that the creditor will accept a lower lump sum to satisfy the account. You will need to have enough money on hand to settle the account with the creditor.
If you need help with your debt, head to FinanceMan.