What To Do If You're Abused By A Debt Collector
Important Legal Disclaimer. The suggestions below are intended for general information when a debt collector is harassing or abusing you. This information may not apply to your situation and is not meant to replace the advice of an attorney. These steps may not apply at all if you are sued. If you are sued, you should immediately find an attorney in your area to give you advice about your legal issue.
What Exactly is Collection Harassment and/or Collection Abuse?
Simply put, debt collectors have a right to collect just and owing debts from consumers. Even so, Congress passed a law called the Fair Debt Collection Practices Act ("FDCPA") in 1977 to protect consumers from abusive collectors. The FDCPA says, in effect, that consumer debt collectors must follow some basic guidelines when dealing with consumers. While a lot of these legal requirements are pretty technical and would be tough to accurately summarize in this short article, here's a good Rule of Thumb: Any behavior by a debt collector toward a consumer over the telephone, in writing, or in person, which is
3. Unfair, or
violates the FDCPA. This means that you may have a right to sue this debt collector and get money back from THEM for their misconduct. Viola! It's that simple.
Debt collectors are expected to act just like civilized adults in their dealings with consumers. While it may seem hard to believe that they do not, the lure of commission income for many underpaid debt collectors is just too hard to resist crossing the line into harassment and abuse.
What to Do if You're Abused By a Collector
If a debt collector contacts you about a debt, you have a right to dispute the debt either verbally or in writing. If you want to preserve some rights under the FDCPA, you must send a written dispute within 30 days of your receipt of the first "validation notice" from the debt collector. Even if you owe the debt, or you cannot pay, you still have rights under the FDCPA. Most of our clients owe the debt being collected but because of financial circumstances, or a dispute over the goods or services, they cannot pay it. In order to preserve your rights under the law, it's important for you to keep good records of all of the contacts.
Four Important Steps You Can Take to Protect Your Rights as a Consumer
1. Save copies of all letters and notices from collection agencies.
2. Save all phone messages and voice mails--this is very important!
3. Make detailed notes of your conversations with these bill collectors.
4. Call one of our consumer rights attorneys now to help you recover your damages.
Documenting the Abuse: Collection Communications Log
Documenting the abuse delivered by harassing debt collectors is CRITICAL to your case. Here's a great way to record all of your collection contacts in one place and in writing. It's called the Collection Communications Log. It will standardize, simplify, and legitimize your claims against debt collectors. Click the appropriate link below to get this handy little form for free!
MS Word© Format Collection Communications Log
Adobe PDF© Format Collection Communications Log
Remember: If you have suffered from any abusive bill collection practices, you may be entitled to compensation. Please contact one of expert consumer lawyers now for help.
Some Things to Consider
Who is Collecting. When you are harassed by a debt collector the first thing you must evaluate is whether this is the original creditor, a third party collecting for the creditor or a company that bought the debt after default and/or after the debt was charged off. Collection agencies and attorneys who regularly collect debts must comply with the Fair Debt Collection Practices Act. The original creditor is generally not liable under the FDCPA unless it is holding itself out as a collection agency (some do to scare people) or if the owner of a debt acquires it after default. Some state laws regulate creditors collecting their own accounts. If neither the state law nor the FDCPA apply, jump below to the third step to see what other laws may apply.
What Type of Debt. Evaluate what type of debt you are alleged to owe. If the debt collector is attempting to collect a consumer debt such as a utility bill, car payment, home mortgage etc., you may be protected by the FDCPA. If it is a commercial debt such as rent for office space, you are probably not protected by the FDCPA. Certain other debts that do not fit squarely in a category may - or may not be covered by the FDCPA. For instance child support payments and fines for traffic or parking tickets are not consumer debts.
Look At All Laws. In addition to the Fair Debt Collection Practices Act, consider what other laws may apply. A very limited list for consideration is as follows: The Fair Credit Reporting Act - among other things, makes it illegal for a collection agency to harass you by putting false information on your credit report (however under the FCRA you may have to send a dispute to the credit reporting bureau to get rights to take action against a collection agency under that statute). State laws - many states regulate collection agencies and regulate the collection of debts other than strictly consumer debts (unlike the FDCPA), many states also have laws that prohibit unfair or deceptive acts and practices. Theft of identity laws - many states regulate investigations of claims of theft of identity. Fair Credit Billing Act - regulates investigations and credit reporting of disputed debts. 15 USC section 1666. Serviceman's Civil Relief Act may protect servicemen and women by limiting interest charged on some types of loans, may stay court proceedings and many other protections. State Common Law - a state may have causes of action that are not generally in statute but which came about by use and tradition by the Courts over the years. These include negligence, invasion of privacy, (negligent or intentional) infliction of emotional distress, defamation etc.
Determine License Requirements. Many states require that collection agencies be licensed to collect from residents. However, some states limit the types of debt collectors that need to be licensed. Check with your state to see if licensing is required and whether the type of debt being collected is covered.
Do You Owe the Debt? Before you decide to pay a debt collector, make sure which debt it is and whether you still owe it. First, determine when you owed the debt but didn't pay. In many states, this is the starting point for the running of the period during which you can be sued for the obligation - the statute of limitations. In some states, later payment may restart the running of this statute. In some states certain things may pause or toll the running of this statute (such as leaving the state, "disappearing" for a while etc.). You may want to pay an attorney to give an interpretation of your own state law on the running of the statute of limitations. If the statute has run, you do not owe the debt. If you may owe more than one debt, make sure you determine which debt the collector is seeking to collect.
Do You Owe This Debt Collector? Before you decide to pay a debt collector make sure this collector "owns" this debt or has authority to collect it. After a debt is "charged off" many original creditors sell the debt in portfolios to collection agencies. From there, collection agencies sometimes sell the debt over and over. It is not unheard of the see a debt sold six times or more. Before you pay a collection agency make sure that company still owns the debt before you pay. Demand proof the company that contacted you acquired the debt and continues to own it. Further, many large collection agencies, perhaps ironically, recently declared bankruptcy. Before you pay a company in bankruptcy, make sure it still owes the debt and didn't sell it to raise money.
Hang Up The Phone. Keep in mind you do not have to sit on the phone and be abused by a debt collector. This may seem obvious, but most of us are not raised to hang up on anyone. Feel free to hang up on collectors if they become abusive or even if they are not helping you get information. Keep in mind you are paying for your phone line. Presumably you got your phone to receive information and not to be abused or to give out personal information about your employer, social security number etc. It's your phone. Hang it up if the debt collector abuses you or if the collector demands information and provides nothing in return.
Documents. Keep any (that's any) collection letters that you receive--they may be evidence of a collector's unlawful practices or harassment. Keep a log of all telephone contacts. This site provides a sample log to use to record the date and time of the call, the name of the collector and agency, and a summary of the conversation. Click here for collection communication log. If your state permits you to record a phone call, consider recording calls from the debt collectors for evidence of any harassing conduct over the telephone. During any phone conversation with a debt collector, be sure to ask for and write down the name of the agency and the name of the caller. You should ask the collector who the original debt was with and insist on a written description of how they contend that you owe the amount claimed. Do not discuss the details of the alleged debt or acknowledge that the debt exists until you review the information requested. You can tell the collector that you are not willing to discuss the debt until you receive these documents and review them. The collector is likely an expert at persuasion and even manipulation, so you must resist the temptation to respond to the various techniques a collector may use to make you feel guilty or obligated to acknowledge or promise to pay a debt if you have any doubt about it being a valid claim against you.
Send Dispute. If you dispute the debt, do so in writing - promptly. Do not delay. You should write directly to the collector to explain your dispute. You may have made a previous payment of the collector was not aware of, the debt may be due to identity theft or the debt of someone else with a similar name, the creditor may have misapplied payment, and many other reasons why you dispute the debt. Even if the debt is something that belongs to you, you may have other defenses to the debt such as an expiration to the time within which you may be sued on the debt or an unlawful provision in the debt agreement. Be sure to send your dispute in writing. Keep a copy for your records and your postal receipt. Your dispute letter may be valuable evidence against the collector if the collector is using unlawful collection tactics or fails to perform its duties under the law when you dispute the debt. Under the FDCPA if you notify the collector that you dispute the debt within 30 days from the initial communication from the collector, the collector must, under Federal law, stop all efforts to collect on the debt until such time as the collector provides you with the information on the original creditor and verifies the validity of the debt. The collector is also obligated to inform you of these rights in writing in its initial written communication or within 5 days after an initial communication by telephone.
Certified Mail. Send Credit Disputes By Certified Mail Return Receipt Requested. Many people who deal with collection abuse issues think it's imperative you send the disputes by certified mail return receipt requested instead of by fax and over the Internet. With certified mail, you can track the letter all the way to the collection agency: Click here to go to the US Postal Service site. You'll need the Receipt for Certified Mail (attach this form to the letter following the directions at the bottom of the receipt), the Domestic Return Receipt (fill in sections Addressee 1; Article Number 2; Service Type 3, check "certified mail"; also write your address on the reverse site) and, of course, postage. At the time this was written the cost is $4.64 to send a letter with a couple pages by certified mail return receipt requested ($4.79 if you send more than a couple pages and on from there) . Check here for more details - Click here to go to see postal service rates. Although the post office seems to want the letter presented to them for the receipt to be stamped, simply putting the correct postage on the letter and placing it in the mail box, then tracking it on the web seems to work. Talk to your local post office to determine how they like to handle the mailing if you want.
Refuse to Pay. If you do not dispute the debt, if you can not pay, consider sending a letter stating you refuse to pay. If a collector receives this letter it must stop collection contacts other than a suit to collect the debt. Keep in mind however, this forces the issue and may make the debt collector file suit sooner than it otherwise would.
Credit Reports. Obtain all current credit reports. See if this alleged bad debt is being reported. The 3 bureaus are Experian, Trans Union and Equifax. You can get a free credit report from all three agencies at www.annualcreditreport.com.
Click here to go to get your free credit report. If there is an inaccuracy, write each agency by certified mail return receipt requested. Ensure your dispute letters provide your identifying information (name, address, social security number and date of birth) identify the entries with specificity.
Paying the Debt. If you owe the debt to that collector and decide to pay, make sure to get a statement of what you owe before you send any money. Send a cover letter with any payment outlining the terms under which you are paying, especially if you negotiated a lower payment than the amount stated. Designate the specific debt the payment is to cover. Send it (like all correspondence with the collector) but certified mail return receipt requested. Some people send money orders and then lose the number of the money order later when they are trying to prove payment. Sending a check may be safer, but also consider the collector will then have your bank account number and can check the balance of your account (and know where to garnish funds). If you owe more than one debt the collector knowing your account number may affect you.
Likelihood Of Being Sued. What are the chances you will be sued if you don't pay the collector? It varies from debt collector to debt collector. Some collection agencies only send collection letters, some mostly make phone calls, and some have authority to file suit. Beyond this, some will write a letter, followed by phone calls; some never call, just file suit etc etc. It is hard to know exactly what will happen unless you know how that debt collector works or what the creditor has authorized the collector to do. If a debt collector receives a letter demanding a debt collector cease contact, if the debt collector does file suit, it may make it more likely suit will be filed as this may be the only option, while other debt collectors simply send the account back to the original creditor of forward to another debt collector.
Get Help. If you determined that a debt collector is violating your rights, find out more about your rights by contacting an attorney, if you trust them...