I am being harassed by a collection agency: what can I do?

Collection agencies get paid a percentage of the debts they collect, so they are highly motivated to get payment. Individual collectors may threaten to seize your goods or even imply that they can send you to jail.

Collection agencies cannot send you to jail and they must go through a court process before they can seize your possessions (the only exception to this is you have signed a lien at the time you bought an item, in which case the individual creditor can repossess an item without going to court).

There are laws that protect you from harassment by collection agencies; they are not allowed to call your place of work, for example. If you feel that you are being harassed, start keeping a record of the number of calls, at what time of day they were placed, and even consider recording them (you must, by law, inform the other party that you  are recording the conversation). There a few other steps you can take:

• Change your phone number and make it unlisted. This is a quick way to stop the phone calls, but if and when you surface, you can expect the calls to start again. Use this breathing space to contact a bankruptcy trustee for a free consultation as to your options.
• Negotiate a deal for partial payment. A collection agency may be willing to accept a partial payment, especially if you can offer it as a lump sum, as a bird in the hand may be worth more than the chance of you declaring bankruptcy.
• Discuss a debt management plan (this is a formal process) through a credit counsellor. Bankruptcy trustees are often also licensed credit counsellors or, if you prefer, will have a list of area credit counsellors.
• Talk to a licensed trustee about filing a consumer proposal that will reduce all of your eligible unsecured debts.
• Apply for bankruptcy through a bankruptcy trustee. This will discharge all eligible unsecured debts, usually within nine months of filing.

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