The Consumer Protection BC inquiry team receives a large number of calls around debt collection each month. Although we have written a few blogs already about this topic, we thought it might be useful to share some tips around debt collection.
If you owe a debt that has now been passed to a collections agency, you will likely be asked to pay off the full amount as soon as possible. Although this may be the best way to avoid incurring any more interest on the account, this may not be an option for some people. Under the Business Practices and Consumer Protection Act, collection agencies are not required to accept payment arrangements. That being said, you have the ability to propose payment arrangements which are agreed upon by both parties. If you find yourself in this situation, you might consider calculating how much you can afford to pay on a regular basis (usually once every two weeks or once per month) and propose this to the agency. If the collection agent agrees to accept these new payment arrangements, request to have this arrangement sent to you in writing prior to making any payments.
Once you receive a letter in writing confirming your new terms and conditions, be sure to make your payments in full and on time. If you are late on a payment or pay less than the negotiated amount, the debt may default back to the original terms and conditions and you may be asked to pay the entire amount off immediately. As in any situation where money transactions are involved, it is best to keep a copy of the proof of payment. This is very important for your own records.
For more information about debt collection, please visit our Consumer Help section of our website. If you have questions, please feel free to contact us or post in comments below.
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6 thoughts on “Tips for negotiating with collection agencies”
Michelle, this is a very helpful post. Thank you. I work as a mediator of commercial disputes, and the advice you provide for consumers, e.g., negotiating terms that you can move forward with, and live up to, is bang on. And building on that, and with a consumer hat on, it would be nice to see more info about the collection agent’s mindset… how do they approach debt negotations? This type of info also benefits the consumer. The more you know about the interests of the person you’re negotiating with, the better.
Very pleased to see such a good article, I appreciate deeply.
I am continually getting phone calls and letters from a collection agency for an individual who passed away while renting a room in my house. We have written and phoned the collection company before the death and many times after that she was unable to pay (on welfare and dying of cancer). And of course after when she died. This has been going on for 21/2 years. What are our options?
Hi Betty-Anne. Yes, we can help you stop the calls. I would recommend faxing the collection agency a “not the debtor” form. Here is a link to the form.
What are the time lines around collecting debts in BC? I thought it was 2 years but I maybe confused with AB?
Hi Terry, BC has a two-year basic liability limitation period and it comes with many exceptions and rules so please check the Limitation Act yourself. Here is the link to the law. Here’s also a link to Clicklaw Wikibooks on options for getting out of debt. We do not oversee this area of law so if you have any questions, please consult a lawyer. Access Probono has a Lawyer Referral Service and they may be able to provide up to a half-hour of free legal consultation. Here is their website. I hope this information helps!