Debt collection is often surrounded by myths and misunderstandings. These misconceptions can cause unnecessary stress and anxiety for those dealing with debt collectors. We want to clear up some of these myths and address the major concerns people have about debt collection in Canada. This article aims to simplify the information so that everyone can understand their rights and the realities of debt collection in working towards resolving credit issues
Myth 1: Debt Collectors Can Arrest You
Reality: Debt Collection is a Civil Matter
One of the biggest myths is that debt collectors can have you arrested if you don’t pay your debts. This is not true. Debt collection is a civil matter, not a criminal one. This means that you cannot be arrested or go to jail for not paying your debts. Debt collectors can take legal action against you, such as suing you in court to obtain a judgment, but this does not involve criminal charges or jail time.
Myth 2: Debt Collectors Can Immediately Seize Your Property
Reality: Legal Process Must Be Followed
Another common myth is that debt collectors can immediately seize your home, car, or other property if you owe money on consumer debts. In reality, debt collectors cannot take your property without following a legal process. They must first sue you in court and win the case. Only after obtaining a court order can they potentially take action to seize assets. This legal protection is in place across all provinces in Canada.
Myth 3: You Must Pay the Debt in Full Immediately
Reality: Payment Plans Are Often Negotiable
Most consumer debts are considered demand debts and you are required to pay in full when you meet the conditions for the creditor to demand the debt in full. This is usually a specified number of days delinquent. If you are unable to pay in full , most creditors will accept a regular and consistent payment arrangement. It is very important to communicate with the debt collector to discuss your payment options early in the delinquency process
Myth 4: Ignoring Debt Collectors Makes the Debt Go Away
Reality: Ignoring Debt Can Lead to Serious Consequences
Ignoring debt collectors does not make the debt disappear. In fact, it can lead to more severe consequences. Debt collectors can take legal action against you, which can result in wage garnishment or liens on your property. Additionally, ignoring debts can severely damage your credit score, making it difficult to obtain loans or credit in the future. It’s crucial to address debt issues head-on and seek help if needed.
Myth 5: Debt Collectors Can Call You Anytime
Reality: There Are Regulations on When Debt Collectors Can Call
There is a misconception that debt collectors can call you at any hour of the day or night. However, there are regulations in place to protect consumers from harassment. In Canada, debt collectors are restricted to specific times when they can contact you. For example, in Ontario, debt collectors can call 7 AM–9 PM Monday–Saturday and 1 PM–5 PM on SundayUnderstanding these regulations can help you manage interactions with debt collectors more effectively.
Major Concerns About Debt Collection
Concern 1: Harassment and Aggressive Tactics
Many people worry about being harassed by debt collectors. It is not harassment to call you about your debts to discuss resolving your debts. It is illegal for debt collectors to use aggressive or abusive tactics. If you experience harassment, you can file a complaint with your provincial consumer protection agency.
Concern 2: Damage to Credit Score
Another major concern is the impact of unpaid debts on your credit score. Unpaid debts can significantly lower your credit score, affecting your ability to get loans or credit in the future. Unpaid collections have an even bigger impact on your credit worthiness. It is important to address debts promptly to minimize damage to your credit.
Concern 3: Understanding Your Rights and Responsibilities
Consumers often feel overwhelmed and unsure of their rights when dealing with debt collectors. It’s important to know that you have rights and protections under Canadian law. Collection agents have rules and regulations to follow. Generally it is the responsibilities of both parties to work together in making an arrangement to resolve the debt..
Concern 4: Financial Strain
Dealing with debt can put a significant financial strain on individuals and families. If you are unable to resolve your account on your own there are financial advisors and credit counsellors who can represent you in dealing with your creditors. Check out our website for some recognized organizations who can help you come up with a financial plan to resolve your current situation and assist you with coming up with a plan for your financial future.
Concern 5: Legal Action
The possibility of legal action is a serious concern. If a debt collector takes you to court and wins a judgment, it can lead to wage garnishment or liens on your property. Generally when they take these actions you are required to pay a portion of their costs. Increasing your debt. Being proactive and communicating with debt collectors can help you set up a repayment schedule you can afford and avoid these legal consequences.
How Pyxis Works and Why It’s an Excellent Solution
At Pyxis, we understand the stress and challenges that come with debt. We are not your normal debt collectors. It is actually to your benefit we purchased your account. Our approach is designed to help you manage and repay your debts in a way that minimizes stress and maximizes financial recovery. Here’s how we do it:
Personalized Debt Solutions
We recognize that every financial situation is unique. Our team of experienced debt specialists works with you to develop a personalized debt repayment plan that fits your budget and financial goals.
Transparent Communication
Transparency is key at Pyxis. We ensure that you fully understand your debt situation and the steps we are taking to resolve it. We provide clear and detailed explanations of all agreements, and we are always available to answer your questions and address your concerns.
Legal Compliance
We strictly adhere to all federal and provincial regulations governing debt collection practices. This means you can trust that our methods are ethical, legal, and designed to protect your rights as a consumer.
Flexible Payment Plans
Every account we purchase has a pre-approved payment plan on our self serve portal. If the payment plan is out of your reach then contact us. We can evealuate your situation and offer another flexible payment plan tailored to your individual financial situation. Whether you need to spread payments out over a longer period or make larger payments to get out of debt faster, we work with you to find the best solution.
Support and Guidance
Our support doesn’t end once a plan is in place. We provide ongoing guidance and support to help you stay on track with your payments and avoid future debt problems. This support can be as simple as setting up text or email reminders of scheduled payments in your plan, or it can be a referral to a recognized service provider in the credit counseling/insolvency space. Our goal is to help you achieve long-term financial stability.
Proven Results
Pyxis has a track record of successfully helping consumers reduce and repay their debts. You will see significant reduction in your debt amounts and improvements in their credit scores over time.
Conclusion
Understanding the myths and major concerns about debt collection can help you navigate this challenging aspect of financial management. Remember, debt collectors cannot arrest you, seize your property without a court order. Their job is to help you resolve your account. Addressing debt issues head-on and knowing your rights can significantly reduce the stress and anxiety associated with debt collection. If you need assistance, don’t hesitate to seek help from professionals who can guide you through the process.
By dispelling these myths and addressing common concerns, we hope to empower you with the knowledge to handle debt collection with confidence and clarity. Start paying off your debts using our payment portal – click here.