Dealing with Debt Collectors Effectively

There are 3 kinds of debt collectors.

  1. Assignee Collector – These collectors have accounts assigned directly to them
  2. Debtbuyers–Thesecollectorspurchaseaccounts
  3. Collection attorneys – These accounts have been placed with law firms

There are 3 ways to handle collectors.

  1. Consultwithaprofessional
  2. Useforumsforproblemdiscussion
  3. Understand FDCPA laws

Who are debt collectors?

Debt collectors collect past-due or unpaid consumer accounts. Creditors often assign unpaid accounts to collectors when their attempts to collect have failed. These collectors get commissions on amounts collected. Sometimes collectors buy accounts for pennies on the dollar and creditors sometimes assign accounts to law firms who can sue consumers for debt recovery.

article-0-074D9750000005DC-535_233x4232

The law on debt collectors

Collectors can:

  1. Call you about collecting money
  2. Call your relatives to get your contact details
  3. Sueyouandgarnishyourwages
  4. Getjudgmentordersfromcourttoseizeproperty
  5. Reportyouraccountstocreditbureaus
  6. Sell your account to another collection agency

When can debt collectors call?

The FDCPA Act provides that collectors can call from 8:00am to 9:00pm regarding payments. They must not call your office if you’re not allowed to receive collection calls there and if you have legal representation regarding the debt, the collector must contact them.

How to deal with debt collectors

  • Ask them to prove you owe money: Send a certified letter to the collection agency requesting debt validation. This will verify if the collection agency is authorized by your creditor to collect money. Don’t acknowledge debt you do not owe.
  • Dispute debt that is not valid: Dispute the debt in writing if the collection agency cannot validate it. Send a certified letter to the agency requesting their communication cease.
  • Maintain all records: The records will say you must pay a certain amount. Not all collectors keep proper records, so make sure you keep them of all documents and conversations with collectors for as long as you feel a need. You could get a collection call for a loan which has been paid off for 15 years. Accurate records and documents protect you. Also, don’t pay money just to get rid of a harassing collector.
  • Protect your bank accounts: Keep Social Security and disability payments in separate bank accounts from the household account. Collectors can get a court order to freeze a bank account and that would prove devastating to a family budget. Social Security and disability funds are exempt from garnishment.
  • Craft an agreement: Make an agreement with the collector and negotiate a payment plan on valid debt based on your monthly income. Set up an arrangement which will allow you to make payments to the collector and still meet your personal budget. A credit counselor or debt negotiator can be consulted if need be.
  • Get it all in writing: Get the repayment plan in writing from the debt collection agency – signed by an agency representative. This will help avoid miscommunication regarding the terms and conditions of payments.
  • Know your rights: It is important to educate yourself about your basic consumer rights in order to deal with debt collectors. For instance, you have the right to ask collectors to validate debt after receiving a collection notice. You also have the

right to ask the collector’s identity, name of the collection agency and the debt amount. Know your rights according to the Fair Debt Collection Practices Act and find out what to do if collectors violate those rights.

Complain if necessary: Don’t allow harassment from a debt collection agency. Search the Internet – find contact details of your state attorney general, FTC or a consumer attorney. A good attorney can tell you how to beat debt collectors at their own game and do not hesitate to take legal action in the event of extreme harassment.

What kinds of restrictions do they have?

Collection agencies are prohibited from certain actions while collecting debts. They are prohibited from:

  • Making collection calls incessantly
  • Using abusive or dirty language
  • Giving false information about the debt or agency
  • Threatening to hurt you in any way
  • Sending papers that appear to be official documents
  • Revealing your debt information to a relative or third-party
  • Pretending to be a government official or attorney

What if collectors file a lawsuit?

Debt collectors can file a legal complaint when they don’t receive payments from you. If a lawsuit is really filed against you, respond promptly to the summons yourself or through an experienced consumer attorney. Make sure to respond according to the date mentioned in the court documents. This will help you preserve your consumer rights.

If collectors are able to prove that you owe money on a valid debt, then the court may issue a judgment order. This empowers the collector to garnish your wage or bank accounts and collect their money.