Know Your Rights When Dealing With Debt Collectors

 A slow economy and rising unemployment mean more people are struggling to pay their debts. If you are in this situation you are not alone, and there is help available. If you have been contacted by a debt collector you should know your rights under the law. The Fair Debt Collection Practices Act establishes what collectors can and can not do, and prohibits them from engaging in abusive tactics while attempting to collect a debt. This article briefly summarizes your rights when dealing with a debt collector.

First let me say that the absolute best way to resolve this situation is to do everything you can to pay off your debts. This is the most direct way to reestablish your peace of mind and have a fresh start. If you can pay your debt, or come to a reasonable payment plan with a debt collector, make sure you get everything in writing. Keep meticulous records and stick to the plan. If this is not possible and the collectors keep calling it's very important that you know your rights and not let a debt collector make your life miserable.

A collector is not permitted to contact you at odd times, before 8:00 a.m. or after 9:00 p.m., unless you give specific permission. They may not call you at work if you inform them that you are not permitted to receive calls at your place of employment.

It is reasonable to first talk to the collector to determine if the matter can be resolved and if the debt is truly yours. If you decide that you do not want further contact with a debt collector you can ask them to stop calling and they must comply, but you have to do this in a specific way. You must send the letter by certified mail with a return reciept and keep a copy of the letter for your files. After receiving the letter, the debt collector can legally contact you for only two reasons: to tell you there will be no further contact, or to inform you of other specific actions being taken, such as a lawsuit. Collectors can still contact your attorney, if you have one, but are not permitted to contact anyone else about your debt, such as friends, neighbors and relatives.

A debt collector must provide you with a document called a validation notice, which must include the amount you owe and to whom you owe the original debt. You should always ask for this document within 30 days of first contact, as many creditors will not provide it up front. This proves they have an interest in the debt and have the legal power to collect it. Without this document they have no way to prove that the debt they are trying to collect is accurate, valid, and belongs to you. Once you request a validation letter a collector can not contact you further without providing it.

Collectors are strictly forbidden to use any kind of harassment, threats or profane language. They may not call repeatedly or make false statements. If any incidents like this occur, make sure you document everything and also keep your phone records. Debt collectors are not permitted to misrepresent themselves or their authority, or threaten you with arrest, wage garnishment, or property confiscation. They may not charge a fee or interest on top of the debt they are trying to collect unless your state's law makes any provision for this.

If you have an outstanding debt that remains unpaid, and the debt collection company has verified that the debt is yours and they have purchased the debt, it is possible that they could sue you for a judgment. Never disregard a court summons. Instead, respond to the summons promptly, plan to be there for the court date, take all of your paperwork including a proposal for repayment of the debt, and make a reasonable case for what you can do. Avoiding a judgement and potential garnishment of your wages is always the best course of action, and being prompt, open and honest will always work in your favor.

If you have been treated unfairly or harassed by a debt collector you have the right to sue for one year following the incident. Many people find this process to be more hassle than it's worth, but a judge could order a debt collector to pay you for damages and the cost of court and attorney fees. You can report any unfair practices by debt collectors to your state's Attorney General's office and the Federal Trade Commission online by following the links in the sidebar.