The financial coaching team at Canopy deal with tough, personal financial questions every day. No matter what the issue, talking with one of our financial coaches can put you on a path to solving even the most difficult problems and situations. Here are two examples:
Q: An old debt of mine was recently sent to collections. What can I do now?
A: Being contacted by a collection agency can be scary. Here are a few tips to help create a plan to resolve the problem.
1. Don’t Panic
Take a moment to evaluate the situation before you act. Ask yourself, Do I really owe the money? Am I in a financial position to pay this debt? What am I prepared to discuss on the phone?”
2. Decide what you want to do
If you know the debt is yours, you do have the opportunity to negotiate a settlement. Think about creating a realistic repayment proposal based on how much you can afford to pay each month, after accounting for bills, other debt payments and emergency costs. If the debt doesn’t belong to you, you can dispute it.
Keep in mind that debt falls under a statute of limitations in each state. This means a collector cannot sue you for a debt that is older than a certain number of years, which generally ranges from three to six years, depending on the state. If the debt is close to the end of the limitations, the collector might be more willing to negotiate with you.
3. Call the collections agency
After evaluating the debt and coming up with a plan, it’s time to contact the collections agency. Consumers have 30 days from the initial communication about the debt to call the collector and ask for the debt to be verified in writing. The collector must return your request before it can start trying to collect the debt again.
4. Let them make the first move
While on the phone with a collector be sure to take note of important information like who you are speaking to, the current balance and rate of interest. If you opt to negotiate the debt, let the collector make the first move. Ask if there’s an option to settle the debt and what they are willing to offer to settle the matter.
Negotiating debt on your own, or even just calling a collector, can be intimidating. Talk with one of our financial coaches to learn more about the expertise and resources available to you and to help you create a workable plan to get the debt settled. They’re here to help and there’s no cost to you. Give us a call and get started today.
Q: I think my identity was stolen. What can I do to fix it?
A: Here are ten tips to help chart a course to overcome identity theft.
1. File a Claim.
If you have an identity theft protection plan such as LifeLock or coverage through an insurer or employer file a claim as soon as you can. Some employers offer identity theft resolution services as a job benefit and some insurers may roll it into their products. For instance, Chubb offers complimentary identity theft resolution services to its policyholders.
2. Notify Companies of Your Stolen Identity.
Don't wait to notify any company where fraudulent transactions or accounts have occurred. Call them immediately to alert them to the problem. Getting the problem solved may be as easy as freezing your accounts so that they can’t be accessed.
If someone is opening accounts in your name, impersonating you or using your Social Security number, you may want to proactively contact other companies and agencies. For example, you should notify the IRS if your Social Security number was used to file an income tax return.
3. File a Report with the Federal Trade Commission.
To file a report with the FTC, visit www.identitytheft.gov. As part of the reporting process, you'll receive a recovery plan and even prefilled letters and forms that can be used to file police reports and dispute fraudulent charges.
4. Contact Local Authorities. File a report with your local police department and ask for a copy of it for your personal records. This creates a paper trail that could be useful in the future. For instance, if someone uses your information to commit a crime, having documentation of identity theft could make resolving the matter easier.
5. Place a Fraud Alert on Your Credit Reports.
Follow up with the three major credit bureaus – Experian, Equifax, and TransUnion – and request a fraud alert be placed on your account. The fraud alert stays on your credit report for a year, and it notifies any institution that pulls your credit report to the fact your identity may be compromised. Requesting a fraud alert is free.
6. Freeze Your Credit.
For an added layer of protection, initiate a credit freeze. This will completely cut off access to your credit report and means the credit bureaus won't share it with anyone who requests it.
7. Sign Up for a Credit Monitoring Service.
If your information was accessed in a data breach, you may be offered complimentary credit monitoring. These services watch credit reports for suspicious activity and send alerts whenever a new account is opened.
If you aren't offered free credit monitoring, you can sign up for a reputable service yourself. Companies like LifeLock charge a monthly fee, while other companies like Credit Karma and CreditWise from CapitalOne offer free services.
8. Tighten Security on Your Accounts.
Review passwords and whenever possible, enable two-factor authentication, which will require both a password and a code delivered via email, text, or phone for access to an account.
9. Review Your Credit Reports for Mystery Accounts.
Whether you're a victim of credit card fraud or a stolen identity, you need to watch for accounts you didn’t open. By law, you're entitled to at least one free credit report from each agency each year. The official site to request them is AnnualCreditReport.com.
10. Scan Credit Card and Bank Statements for Other Unauthorized Charges.
In addition to your credit reports, pull up your other accounts and scan old statements for other charges you don't recognize. Don't forget to review dormant or infrequently used accounts as well. If you find unknown charges, call the financial institution to alert them of the problem and request the account be locked or closed.
At Canopy, we’re here to help. Talk to a member services representative to help you determine how best to avoid further losses. In most cases, that will involve closing and reopening accounts, even ones that haven't been compromised. It can be a tedious process, but a necessary one to avoid a thief from gaining future control of your money.