3 Things to Know About Debt Collectors

What they can and can�t do when collecting on a debt

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DebtCollectionWhile the days of debt collectors sending sheriffs to your home are long gone, for some, contemporary debt collection methods can still cross the line. In an unprecedented recent ruling, the Federal Trade Commission (FTC) announced the largest penalty ever imposed on a debt collection agency for allegedly threatening and harassing consumers, disclosing their debt to third parties, and numerous other infractions.

“We want consumers to understand their rights if their debts go into collection,” says Frank Dorman, spokesperson for the Federal Trade Commission. “The more people know about managing their debt and dealing with debt collectors, the better off they will be.”

What exactly are your rights when it comes to debt collections? Check out these five things you need to know to avoid unscrupulous practices by your creditors.

Debt collectors cannot harass you. It is against the law for debt collectors to harass consumers, including issuing threats of violence, publishing a list of names of people who refuse to pay their debts, using obscene or profane language, or repeatedly using the phone to annoy someone. They also cannot call you before 8:00 a.m. or after 9:00 p.m.  A debt collector may contact you in person, by mail, telephone, telegram, or fax but cannot contact you at work if the collector is aware that your employer prohibits it. To stop a debt collector from calling you must write them a letter–be sure to keep a copy for yourself–and send it certified mail.

Debt collectors cannot lie to you. Debt collectors may not falsely claim that they are attorneys or government representatives, that you have committed a crime, represent that they operate or work for a credit reporting company, misrepresent the amount you owe, indicate that papers they send you are legal forms if they aren’t, or indicate that papers they send you aren’t legal forms if they are.

Debt collectors cannot touch your earnings. This one is a little tricky.  Debt collectors cannot say you will be arrested if you don’t pay your debt or that they’ll seize, garnish, attach, or sell your property or wages–unless a judge has ruled in their favor. Remember, debt collectors may not engage in unfair practices such as trying to collect interest, fees, or other charges on top of the amount you owe unless the contract that created your debt–or your state law–allows the charge, deposits a post-dated check early, or takes or threatens to take your property.

  • Katharine

    What protections do we have if we refuse to give them our checking account information? I have been unemployed for almost a year & of course, I am starting to get some calls. I tell them that I have been unemployed, but am willing to make monthly payments I can afford. They want to get checking acct information – I tell them no because I had an identity theft issue a few years ago when a restaurant worker took my credit card info. & bought a cellphone & plan with it. When I tell them no, and also when I ask for confirmation of the payment arrangements in writing, they refuse & threaten legal action because they are now saying I am refusing to pay & threaten legal action. What are the protections for consumers in that regard? We should be able to refuse to give a third party collection agency access to our bank accounts. The very real threat of identity theft (especially with all this outsourcing customer service to India, etc., ) is a reality.

    • aminah

      Never give your bank account information to any debt collector! If you choose to make arrangements try your best to get it in writing and only use money order from post office to be safe. Know your legal rights. There are legal letters that you can send to them to stop harassing you. Change your bank account to a new one if its related to a loan becuase they can garnish if they have on file. if they dont have on file they cannot touch.

  • Jack

    People have to understand that 3rd party collection agenies are not to blame for there debts thats owed to these companies but at the same time these agenies are known for there strong arm tactics. I think if you was contacted by an debt collector you should get all the infomation about your acct and start making payments that you can honestly afford to make until it is paid off. If you can only pay $15.00 per month send it,These collectors will not send your money back to you. Keep all records of payments made to the agenies so you can provide proof if needed.

  • Erica

    Debt collectors do not have the right to harrass you, no matter of the debt. They are paid to collect a debt. That’s it. In this tough economy, this is the norm to have debts go to collections. It’s unfortunate because of the God-awful amount of jobs/income lost. But it’s critical for people to know their consumer rights.

  • Sam

    How can I pay off my debt on a fixed income. Every month I get phone calls and mails to pay off my debt but by the end of the month I don’t have anything to give. I can’t look for a second job to help with my debt because I am at the mercy of my credit report. What can i do……………………….

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