Why You Should Pay Your Debt Collections (2017 update)

Why You Should Pay Your Debt Collections

It is always painful to give out your money to a debt collector particularly when the item associated with the debt is nowhere to be seen. Deciding whether to pay off or not to pay your collections can be a daunting task. Whichever decision you make paying your collections is the right thing to do. Read below to find why you should pay your collections;

To get rid of collection calls

Debt collectors will keep calling whether you like it or not as long as you have any outstanding debt with them. They will switch collection accounts between different collectors until you take care of your collections. Cease and desist letters won’t stop them from contacting you. So why live with frustrations? Get rid of them by taking care of the debt.

To get approved for credit cards and loans

Getting approved for credit cards or loans can be difficult when your credit report is showing outstanding collection accounts. As such, no mortgage, no car loan, and no credit card! To make the matter worse, some employers may not hire you as long as there are unpaid debts on your credit report. Taking care of your collections doesn’t remove them from your credit report, but it is worth having them as $0 balance.

To improve credit score    

Unpaid collections affect your credit score and may make it even difficult to get approved for other loans. After seven years, unpaid collections accounts will disappear from your credit report. But why wait for seven years? Clear your collections as fast as possible to improve your credit score.

To avoid lawsuits

If you owe unpaid collections within the statute of limitations, your creditor or collector can sue you for the outstanding balance.  If sued, the lawsuit can lead to a court judgment that will tarnish your credit report. Besides the debt collector can seek the permission of the court to have your wages withheld and to clear the balance. Never ignore the amount, after all, it is a debt you should pay.

To live debt free

By paying off your debt, it means your journey to a debt free life has started. Many people feel that paying a debt collection after several years of resistance is not good. But living with debt is neither good for your credit and finances.

Practice discipline with your collections and pay them when you can afford even if the item associated with the debt was consumed long time ago. Paying what you legitimately owe is the best thing you can do for your credit score and finances.

 


Moneylender Singapore is the best directory of licensed moneylender in Singapore. To grab more information, please visit www.sglicensedmoneylender.sg

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