Are you getting calls from debt collectors? Threatening letters in the mail perhaps? These are two commonly used approaches used by collection agencies to intimidate you into paying up. It is important to know what rights you have in such a situation.

Fortunately something called 'The Fair Debt Collection Practices Act' sets the guidelines what actions debt collection agencies can and cannot participate in while trying to collect a debt. For example, they cannot call earlier than 8 AM Or after 9 PM. They cannot claim that they'll be able to garnish wages. Of course, this is limited to states in which garnishment of wages is illegal. And, they cannot continue calling you if you ask them to stop.

The entire text is worth looking through if you are in this situation. You can read it here - http://www.ftc.gov/os/statutes/fdcpa/fdcpact.htm#801

In such situations you have multiple options. These range from simply not picking up the phone, screening calls via caller ID or even getting calls blocked if your phone has that feature.

By any chance if you do pick up the phone, you can insist that you do not wish to be contacted any further. By law, they are obligated to stop pestering you. Of course, if you have sent the collectors a formal notice (such as 'cease and desist') you can take legal action against them. This could be your most expensive option so you might want to hold off on this one.

The fastest way to get them off your back is by paying off the debt. If the debt is a valid one then you do owe them the money. If money is really tight, you can try by renegotiating the terms of your agreement like lower rates of interest etc.

Keeping track of your call history along with any terms that were renegotiated is a good idea in these cases. This will help you keep tabs on your new debt obligations and in case they keep calling you after being told not to stop you can try recording calls if its legal and take action against them. Pretty often the debt collectors will be more careful with their choice of words if they know that their call is being recorded.

One key point to bear in mind is that collection agencies will accept amounts that are a lot lesser than their original claims. Of course, since they get a percentage of their collection amounts they will try to keep the amounts similar to the originating debt. But they do know that 50% of $200 is a lot better than a 100% of $0.

If you do negotiate new terms on your payment, make certain that there aren't going to be any additional negative information placed on your credit history. Its always a good idea to remind them to report any payments you make.

One other tip - get the creditor to send you the terms in writing. If they are unwilling to do so, you can send them a small percentage of the amount to show good faith in keeping your end of the deal. If you pay all of it upfront, they have little reason to honor their end of the bargain.

In times like these be patient, keep your cool and be realistic about the outcomes. These attributes will be immensely beneficial while dealing with these stressful situations.