Fortunately, there are laws in this country that prevent debt collectors from harassing you or strong arming you into repaying your debt. Delinquency on debt repayment is no justification for treating someone horribly. Many people have trouble paying bills no matter how much they work or no matter how organized they are.
Debt Collectors’ Bottom Line
Debt collectors can make money in a few ways. Often times, they enter into a contract with the original creditor whereby they receive an initial payment for collecting a debt and a percentage of the total amount of money collected. In other cases, debt collectors actually purchase the debt. They can sometimes buy a debt for as little as four cents on the dollar. When a debt collector buys a debt, he is then able to keep the total amount of recovered money.
Illegal Behavior
In pursuit of profits, debt collectors will sometimes engage in behaviors that are illegal according to the Fair Debt Collection Practices Act (FDCPA). The FDCPA was enacted to protect consumers from the outrageous behaviors of debt collectors. Some of those behaviors include:
- Using inflammatory language
- Calling people close to you to discuss your debt
- Threatening you
- Impersonating a police officer
- Calling at odd hours
In addition to these, debt collectors may also publish a list of people who will not pay their debts – this is also prohibited by law. And debt collectors are not allowed to mislead you with respect to who they are or how much you owe.
It should be noted that the FDCPA prohibits third-party collectors from this type of conduct, but does not include the original creditors in its provisions. Some states, such as California, have passed laws protecting consumers from harassment by the original creditors, so it’s a good idea to research your state’s consumer protection laws.
FDCPA Requirements
The FDCPA also places certain requirements on third-party debt collectors. They are required to:
- Tell you who they are.
- Inform you that they are a debt collector and anything you say will be used to collect a debt.
- Tell you the contact information of the original creditor.
- Notify you of your right to dispute part or all of your debt. (They must do this within five days of the first communication. After you are notified you have 30 days to ask them to verify the amount of the debt.)
- Verify your debt. (Once requested, the debt collector must send you a letter containing the verification. The debt collector must also inform the credit bureau of any disputed debts. You can still submit a verbal dispute after 30 days, but in this case, the debt collector can refuse to verify the debt.)
Additionally, if the debt collector chooses to sue you for any reason, he must file the lawsuit in the area that you live or where you signed the debt collector’s contract.
Keeping Records
To arm yourself against any potential attacks, be sure to keep thorough records of your relationship to the debtor. Keep letters sent to you and copies of letters you send them. It’s also a good idea to write down relevant dates and times. This information could go a long way if you end up going to court. For tips on writing letters to a debt collection agency visit the Consumer Financial Protection Bureau (CFPB) website.
Course of Action
If you feel you’ve been harassed by a third-party debt collector, you can file a complaint with the CFPB and the Federal Trade Commission. Additionally, you can reach out to your state’s attorney general. If you end up suing the debt collector, you could receive up to $1,000 without having to prove damages. This is because the FDCPA is a strict liability law. Finally, if you end up pursuing a lawsuit, be sure to contact a seasoned attorney who has experience with debt obligation cases.
