If I have debt collectors chasing me, will my debts continue to accrue interest the longer they go unpaid?
Having debt collectors chase you is certainly no fun for the fact that they literally drive you crazy. They can constantly calling you at home, at work, on your mobile phone, and they may even contact your friends and relatives. They will do whatever they can to track you down and get you to pay the bill.
However, it is in your best interest to try to reach a deal with them. Even if you can’t pay the debt in full, you can work out some sort of payment arrangement that will satisfy you and satisfy them. If you don’t, the debt could actually grow.
Depending on the type of debt it is, it can continue to accrue interest. For example, credit cards and loans will continue to charge the monthly interest that is associated with them each time the billing cycle closes. It doesn’t matter if the account is being collected upon. What this does for the collector is allow them to collect even more money from you, so it is ideal for you to pay it off as soon as you can so that the amount is not too much larger than the original amount owed. The only time the interest will stop accruing is if the collector is unable to get hold of you and the account is given “clearout� status.
What you need to do is answer their phone calls and talk to them about the debt amount. You can tell them if you’re having a hard time. If you are, they will try to negotiate something with you. They would rather get their money under altered terms than to have to garnish your wages or take some other harsh action that can really affect you worse financially.
Whatever terms you meet, make sure you follow through with them. You can usually get them to stop any interest from accumulating when you reach some sort of agreement. This allows you to pay the debt off quicker.
Although this won’t remove any negative marks from your credit report for 5 years, the account can be reported as paid in full, which can work in your favor.
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