Penny Pincher: Rocky finances require good communication

BY: Steve Jordon
May 7, 2008
WORLD-HERALD STAFF WRITER

There's a right way and a wrong way to deal with your out-of-control finances, according to debt collection expert Bill Bartmann.

Bartmann started a debt collection company that once had $3.5 billion in annual revenue but imploded a decade ago after a partner was accused of fraud. Bartmann, from Tulsa, Okla., was indicted but acquitted and now is an author and a "business coach."

His advice for those in debt:

1. Communicate quickly with the people you can't pay. Explain your circumstances. They will be impressed and will note your file accordingly, improving your relationship with creditors.

2. Offer a reduced payment within a short, specific time. Make at least a partial payment, even if it is only $10, to show you want to honor your obligation.

3. Answer phone calls and letters from creditors. Ignoring phone calls and letters tells creditors you aren't ready to face your new reality and creates a negative opinion of you. Promptly responding shows you want to act responsibly and want to honor your obligation.

4. Pay the reduced amount exactly on time. Showing you are serious about your obligation indicates the creditor will be paid in full eventually.

5. Stop the bleeding. Change your standard of living to reflect your new circumstances. Giving up former luxuries now will speed your recovery.

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