Know your Rights under the FDCPA and other State Laws
The FDCPA (and some state laws) protect you against debt collection harassment. Find a website the describes your rights under the FDCPA. Our website is www.debtcollectorshateus.com but there are plenty of other sites available for reference.
Discern which Debt Collectors are legit and which ones are Scams.
When you paying collection agencies you want to be sure that the company you are paying in fact has authority to collect the debt and is not one of the Scam Debt Collectors. Many scam debt collectors have popped up recently buying consumer data and using that data to trick unsuspecting consumers into paying them on a debt that either does't exist or that they don't have authority to collect. I highly encourage consumers not to pay any collection agencies UNLESS they first provide them with proof that (1) a valid debt is owed, and (2) the agency have the authority to collect it. If you discover you have been speaking with a scam debt collector, feel free to tell them you know they are a scam operation and that no matter what they do they will never receive a cent from you. This should cause them to move on to the next name on their list. As a side note, the FTC & Dozens of Attorney Generals are currently trying to locate these companies; most of which operate offshore.
Get Everything in Writing
I've heard horror stories from clients that say they reached a payment arrangement or settlement arrangement with a collection agency and complied with its terms only to later find out the collection agency denies ever having made the settlement offer. So, make sure you get any agreement between you and the Collection Agency in writing!
Learn how debt is transferred/sold - Try to settle it yourself!
Debt is first often collected in-house by the creditor. If the debt is still in-house with the original creditor, try to come up with a payment plan with the Creditor. Start low - such as 30% paid over 12 months. This won't be accepted by the Creditor but will give you a place to start negotiations. After an Original Creditor is unsuccessful in collecting the debt itself it sends it to a third party collection agency. Although these companies also have the ability to work out payment arrangements, their authority is more limited because the creditor already has to give up some of the $ collected to the collection agency as payment. If a collection agency is unsuccessful in collecting the debt it will either be sent to a law firm for additional collection attempts (not a lot of ability to negotiate) or sold to a debt buyer (TONS of room to negotiate). If sold to a Debt Buyer, try to settle the account for $.20 on the dollar. Most likely they paid much less!