Is it possible for a collection agency to send someone to my place of residence to collect? I own a home-based business with a partner, and we have been hit hard by this recession, losing at least 80% of our business in the last two years. We're making just enough money to keep my business partner from being evicted (she isn't able to get help from her family) and to pay for food and medicine, but nothing else. I haven't been able to pay any of my credit card bills for almost a year, and I had to sell my house and am now living with my parents because I have no money. The creditors continue to call and mail me collection notices, and I've already sent them letters describing my current situation. Our business may pick up soon, but I can't guarantee anything until we receive client checks, and even our clients are having trouble paying us. I'm not sure if it was a collection agent who knocked on my door recently, but I heard from my parents that someone was looking for me and was holding an envelope that said "Confidential". Would that be from the collection agency? Every time I've tried to explain my situation over the phone, the phone rep. just refers me to a monthly payment program or tells me about lowering my debt, neither of which I can afford because I haven't been paid since June 2009. I may be able to pay my bills in the near future, but not right now.
It is possible and legal for a collection agent to appear at your door to attempt to collect a debt. I spoke to a Bills.com reader who had a debt collector do just that. However, it is very rare for personal debt collection due to the cost. A telephone call is more cost effective.
It is far more likely the visitor was a process server and you were to be served a summons and complaint. A summons and complaint is just that — a court order to appear before a judge for the reason stated in the summons. My guess is one of your creditors became impatient and decided to sue you to collect the balance due on your account.
I recommend you attempt to resolve this debt with the creditor or the creditor’s attorney before the hearing. If you obtain a fairly sizable portion of the balance, the creditor may be willing to settle the debt. For example, if you can offer 40%-60% of the outstanding balance in a lump sum payment, the creditor may be willing to forgive the remaining balance and dismiss the court case. Contact the creditor’s attorney to discuss settlement of the debt and keep trying to negotiate. If you come to a dead-end there, you have the option to set up a payment plan.
If you cannot access a lump sum to settle the debt, the creditor may be willing to accept monthly payments to stop further collection activity, but will probably not dismiss the case against you. The creditor will want to obtain a judgment against you just in case you do not make your scheduled monthly payments. Again, contact the creditor’s attorney to discuss possible repayment plans and ask them about a stipulated judgment payment plan.
If you do not resolve this matter, the creditor will likely obtain a judgment and proceed to attempt to collect on the judgment. Depending on the state you live in, judgment execution could include wage garnishment, bank levies, and property liens, and other actions. I encourage you to speak with a local lawyer to discuss the implications of a judgment against you, and what is the best course of action to resolve the account.
I hope this information helps you Find. Learn & Save.