Anyone with card debt should be more concerned about aggressive collections or legal charges
When it comes to credit card debt, many are faced with the constant worry of how financial institutions may try to recover the amount owed. Two common forms of approaches by banks are aggressive collections and judicial collections.
Aggressive collections refer to the strategies adopted by financial institutions to obtain payment of outstanding debts in a more immediate and effective way. This can include frequent calls, texts, emails, and even hiring third-party billing companies.
This approach aims to push the debtor to pay off the debt as quickly as possible, often by offering special payment terms or settlement agreements.
On the other hand, legal charges involve the legal system. When a debtor becomes unresponsive or is unable to reach a satisfactory settlement through aggressive collections, the creditor may decide to take legal action. This process can lead to a court order to pay the debt and, in some cases, the possibility of garnishment of assets or wages.
It is important to understand the differences
Understanding the difference between these approaches is critical for anyone facing financial hardship. Aggressive collections can be intense, but they are often an attempt to avoid longer and more expensive legal proceedings. It is important to note that laws vary from country to country and, in the Brazilian context, the Consumer Protection Code offers protections against abusive billing practices.
On the other hand, legal collections represent a more advanced stage in the debt collection process. They indicate that the creditor is willing to seek a legal solution to the case, which could lead to more serious consequences for the debtor in case of failure to cooperate.
Given these considerations, anyone with card debt should take a proactive approach. It is advisable to contact the creditor as soon as financial difficulties arise, seeking valid payment agreements or renegotiations. Ignoring the situation can lead to increased charges and ultimately lawsuits.
Always seek communication
Both aggressive collection and judicial collection are strategies banks can employ to recover card debts. The best way to deal with this situation is to seek open communication with the creditor, seek workable solutions and, when possible, avoid worsening the situation which could lead to more severe legal measures.
Understanding local laws and seeking financial advice can be valuable resources in this process, helping to ease your debt burden.
Watch the video on the topic with comments from Leonardo Camiza Machado, lawyer from Silveiro Advogados and commercial law specialist from PUCRS Law School.
inspires transformation in the world of work, in business, in society. Compasso, a content and connection agency, is born.
Source: Terra
Rose James is a Gossipify movie and series reviewer known for her in-depth analysis and unique perspective on the latest releases. With a background in film studies, she provides engaging and informative reviews, and keeps readers up to date with industry trends and emerging talents.
