So you’ve screwed up. You’re drowning in debt. Maybe
credit card was burning a hole in your pocket and you just had to get HDTV. Or maybe you or a family member had a medical emergency while you we laid off. It doesn’t matter to your creditors; they lent you money and now they want it back. The lender will try to work with you for a while and its best to try to negotiate with them at this stage. If you can’t work something out or just don’t pay, they will send your file to either an in-house bill collector or, more commonly to an outside agency.
Bill collectors are a tough bunch. They have heard all sob stories and aren’t interested in yours. They mostly get paid on commission, so they just want to get money out of you and move on.
There aren’t many laws to get you off hook as far as debt goes (bankruptcy is your only choice). But there are laws that prevent harassment and abuse by bill collectors. Debt collectors tend to try to ignore these laws, but if you know your rights and insist on them, at very least you might be able to collect damages if bill collector persists in ignoring them.
The major law protecting you is Federal Fair Debt Collection Practices Act. Some states have their own versions of this law.
The law does not prevent a bill collector from contacting you, but it must be at convenient times. Contact can’t be before 8 a.m. or after 9 p.m., unless you agree. A debt collector also may not contact you at work if you tell him that your employer disapproves of such contacts.
If you don’t want to be harassed, get name, address and telephone number of bill collector. Then send a certified letter, return receipt requested telling collector to leave you alone. Once collector receives your letter, he can not contact you again, except to say there will be no further contact or to notify you that bill collector or creditor intends to take some specific action against you, such as sue you or report your delinquency to a credit bureau.
The bill collector can contact friends, relatives or neighbors, but just to find out where you are. They are not supposed to be spreading word that you’re past due on your debts.
Within five days of first contact, collector must send you a written notice telling you amount of money you owe; name of creditor to whom you owe money; and what action to take if you believe you do not owe money. You have 30 days to dispute debt, in writing (certified mail RRR again). The bill collector is then not allowed any other contact with you until he is able to send you proof of your debt.
According to Federal Trade Commission (FTC) agency charged with enforcing Fair Debt Collection Practices Act:
Debt collectors may not:
• use threats of violence or harm; • publish a list of consumers who refuse to pay their debts (except to a credit bureau); • use obscene or profane language; or • repeatedly use telephone to annoy someone.
Debt collectors may not use any false or misleading statements when collecting a debt. For example, debt collectors may not:
• falsely imply that they are attorneys or government representatives; • falsely imply that you have committed a crime; • falsely represent that they operate or work for a credit bureau; • misrepresent amount of your debt; • indicate that papers being sent to you are legal forms when they are not; or • indicate that papers being sent to you are not legal forms when they are. Debt collectors also may not state that: • you will be arrested if you do not pay your debt; • they will seize, garnish, attach, or sell your property or wages, unless collection agency or creditor intends to do so, and it is legal to do so; or • actions, such as a lawsuit, will be taken against you, when such action legally may not be taken, or when they do not intend to take such action. Debt collectors may not: • give false credit information about you to anyone, including a credit bureau; • send you anything that looks like an official document from a court or government agency when it is not; or • use a false name.
