[4 Legal Ways] How to Pay Off Your Debt with NO Money?

Being in debt isn’t fun, and neither is it something you thought you would have to face. But then, life happens.

The economy fails, you lose your job. You survive on your savings and credit card as long as you can, and now you’re broke and in debt.

Or, you just bought a new house, and your loved one has been diagnosed with a serious disease. The medical bills have brought you to your knees and you have no way to pay off your debts.

Soon you start getting a call from a debt collection agency, and things seem to be going downhill after that.

pay off debt

These and many other situations like these are realities for many people today. Which is why the law allows for various solutions related to debt repayment. Many of us are not aware of this.

How to Handle Debt Repayment?

How to pay off debt with no money and when you are broke?

Here are a few things you can do to get back on track if you are in debt and are being called by a debt collection agency.

  • Contact Your Credit Provider as Soon as Possible

Do not wait till your account is handed over to a debt collection agency. Call your debt collection agency as soon as you know you are going to have trouble paying off your debt. Discuss a repayment plan.

At this point, you need to be upfront about your situation and also be honest about how much you can afford to pay.

  • Apply for Hardship Variation

You can apply for a hardship variation, which is a facility offered under Section 72 of the National Consumer Credit Code to debtors who are experiencing financial hardship.

While you apply for hardship, you also need to keep paying as much of your debt as you can realistically afford to.

Through this facility, you will have various options for loan repayment with your lender:

  • Extending your loan period
  • Making smaller payments over a longer period
  • Postponing your repayment for a certain amount of time
  • A combination of the three options mentioned above
  • Other ways in which you can afford to pay off your loan

Meanwhile, you can work on improving your financial situation.

  • Speak with a Financial Counsellor

If you really cannot afford to pay off your debts, you can speak with a financial counselor. These are professionals who can give you advice on how you can pay off your debt and even negotiate on your behalf with your lender.

  • Get Legal Help

Many of the countries have government supports and legal community centers to help.

The Australian government has set up community legal centers as well as Legal Aid agencies. They helped debtors by providing them with free legal advice on how to proceed.

Use their services to see how you can deal with your bad debts.

What Should You Do When a Debt Collection Agency Contacts You?

If your delinquency has reached a stage where a debt collection agency is calling you, then it is in your best interest to cooperate with them. However, you still can be expected to be treated with professionalism and courtesy.

In this case, you need to honest about your financial condition. Do not try to avoid your debt collectors’ calls. Speak with them promptly and try and reach an agreement for a repayment plan – if you can afford it.

In case your contact information changes, be sure to inform the debt collection agency.

Remember, you owe a debt and it needs to be paid off somehow. By avoiding repayment, you can end up in legal trouble.

Start making money online. This will help you repay your debt.

Are you doing everything you can to repay your debt, but you feel you are being unfairly treated by your debt collectors? You need to file a complaint as soon as possible.

These are the legal way for- how to pay off debt with no money.

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