You should know that in either situation Fair Debt Collection Practices Act requires that debt collectors treat you fairly by prohibiting certain methods of debt collection. Of course, law does not forgive any legitimate debt you owe.

This brochure provides answers to commonly asked questions to help you understand your rights under Fair Debt Collection Practices Act.

What debts are covered?

Personal, family, and household debts are covered under Act. This includes money owed for purchase of an automobile, for medical care, or for charge accounts.

Who is a debt collector?

A debt collector is any person, other than creditor, who regularly collects debts owed to others. Under a 1986 amendment to Fair Debt Collection Practices Act, this includes attorneys who collect debts on a regular basis.

How may a debt collector contact you?

A collector may contact you in person, by mail, telephone, telegram, or FAX. However, a debt collector may not contact you at unreasonable times or places, such as before 8 a.m. or after 9 p.m., unless you agree. A debt collector also may not contact you at work if collector knows that your employer disapproves.

Can you stop a debt collector from contacting you?

You may stop a collector from contacting you by writing a letter to collection agency telling them to stop. Once agency receives your letter, they may not contact you again except to say there will be no further contact. Another exception is that agency may notify you if debt collector or creditor intends to take some specific action.

May a debt collector contact any person other than you concerning your debt?

If you have an attorney, debt collector may not contact anyone other than your attorney. If you do not have an attorney, a collector may contact other people, but only to find out where you live and work. Collectors usually are prohibited from contacting such permissible third parties more than once. In most cases, collector is not permitted to tell anyone other than you and your attorney that you owe money.

What is debt collector required to tell you about debt?

Within five days after you are first contacted, 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.

May a debt collector continue to contact you if you believe you do not owe money?

A collector may not contact you if, within 30 days after you are first contacted, you send collection agency a letter stating you do not owe money. However, a collector can renew collection activities if you are sent proof of debt, such as a copy of a bill for amount owed.

What types of debt collection practices are prohibited?

Harassment. Debt collectors may not harass, oppress, or abuse any person. For example, debt collectors may not:

Each year more than 1,200,000 Americans file for protection under federal bankruptcy laws, according to American Bankruptcy Institute. Some are credit abusers or are financially irresponsible. But average working men and women who try to pay their bills on time can sometimes find themselves in financial difficulties, as well. The sudden loss of a job, catastrophic medical bills, soaring credit card interest, student loans, a divorce or even a natural disaster can quickly wipe out a life's savings. For many, bankruptcy provides a second financial chance.

Bankruptcy is usually used only as a last resort, after other attempts to solve a financial crisis have failed. You may want to talk to an attorney specializing in bankruptcy or a credit counselor to see if you really need to file for bankruptcy. Perhaps an agreement can be reached with your creditors before you take this final step.

Bankruptcy can relieve honest but unlucky debtor from crushing burden of excessive debt by providing a fresh start. It allows you to discharge some of your debt or allows you to get back on your feet without harassment by creditors. For many people decision to file for bankruptcy is difficult. You may think that bankruptcy is a sign of failure or an indication that you are incapable of managing your own financial affairs. In reality, most people who chose to file for bankruptcy intend to pay their bills, they simply do not have resources available to do so. By filing for bankruptcy, you get a fresh start with a clean slate, free of stress and guilt that result from evading or fighting your creditors.

At same time, decision to file for bankruptcy should be carefully considered and not be taken lightly. It is, after all, a Federal court proceeding which can affect your legal right to keep or use your property. And once you start a bankruptcy case, it is near to impossible to stop.

There are two primary types of bankruptcy available to individuals. In Chapter 7, your nonexempt assets may be sold to pay creditors while most of your debts are discharged. In Chapter 13, you prepare a reorganization plan to pay off your creditors either in full or in part. Once you file a bankruptcy petition, an automatic stay prevents creditors from starting or continuing legal procedures against you.