Credit Debt Collections



Debt collection practices, whether by creditors, collection agencies, or attorneys, are a frequent and often emotionally charged source of consumer complaints. Many people finding themselves subject to debt collection may already be experiencing a broad range of financial and personal difficulties. Debt collection is an added indignity. Although debtors are bound to honor their contracts (with a few exceptions for bankruptcies), they should not find themselves subject to harassing and deceptive collection practices. 

There's no law that says you have to communicate with a debt collector by phone. If you hang up on a debt collector there is nothing they can do about it. But, if the collector continues to call you repeatedly even after you have hung up on them, they are in violation of the Fair Debt Collection Practices Act.

All you have to do to stop debt collectors from calling you is tell them that you prefer to communicate with them in writing. Written communication works in your favor because it gives you a record of everything that is said. If the debt collector violate the FDCPA, you have hard evidence that could lead to a lawsuit in your favor. Keep in mind that, by law, the debt collector does not have to honor this request.

Some collection agencies do employ collection methods involving the use of false and misleading statements. Just like any other high pressure salesman, these guys will make lots of "helpful" suggestions to get you to close the deal NOW. They will always try to get you to pay up right then and there. Some examples:

  • Insist you FedEx or Express your check to them (can you really afford to add $12 to the debt you already can't pay?)
  • Charge it on your credit card (sure, charge up the old card - isn't this how you got into trouble in the first place?)
  • They will try to get you to pay by "telecheck". This means you give them your checking account number, and they deduct the amount electronically. NEVER give out your checking account and check routing numbers.

While the FDCPA allows a collector to add interest if your original agreement calls for the addition of interest during collection proceedings, or the addition of such interest is allowed under state law, it is not necessary to spend the money or risk your checking account for any of the above methods. The three or four days it may take to mail a payment with a first class stamp, if they do decide to come after you for interest, won't break the bank.

If you feel that your rights have been violated, you have the right to sue a collector in a state or federal court within one year from the date the law was violated. If you win, the judge can require the collector to pay you for any damages you can prove you suffered because of the illegal collection practices, like lost wages and medical bills. The judge can require the debt collector to pay you up to $1,000, even if you can’t prove that you suffered actual damages. You also can be reimbursed for your attorney’s fees and court costs. A group of people also may sue a debt collector as part of a class action lawsuit and recover money for damages up to $500,000, or one percent of the collector’s net worth, whichever amount is lower. Even if a debt collector violates the FDCPA in trying to collect a debt, the debt does not go away if you owe it.

The FTC works to prevent fraudulent, deceptive and unfair business practices in the marketplace and to provide information to help consumers spot, stop and avoid them. To file a complaint, visit ftc.gov or call toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. 


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