Debt collectors are getting more aggressive as the economy continues to drag along and more and more people can’t afford to pay their bills. Some call constantly, blowing up your phone all day, harassing you both at home and at work. Some verbally abuse you, insulting you and even barraging you with profanity. Some call family members, and even neighbors, asking for your contact information and saying it’s because you’re a deadbeat or that you’re in legal trouble. Some threaten you with lawsuits, wage garnishments, and even jail.
What those collectors don’t want you to know is that all of those tactics are illegal. They’re bound by a federal law called the Fair Debt Collection Practices Act (FDCPA). The Federal Trade Commission has a great guide to your rights under the FDCPA on its website, but here are two of the most important points:
-Debt collectors cannot harass you with repeated phone calls, threats, or profanity. If you don’t want to be called, ask the collector for the agency’s name and address and send a certified letter stating you want the calls to cease. Legally, the collector can only call you one more time, and only to notify you that it receive the demand and it won’t be calling again.
If the collection agency calls after your demand a stop to phone contact, or if a collector harasses, threatens, or otherwise abuses you, even if you didn’t tell the company to cease contact, state that you are going to record the call. Often the collector will hang up or will refuse permission. Simply say, “Okay, then I won’t talk to you until you allow me to record you,” and hang up.
On subsequent calls, state right at the beginning of the conversation that it’s being recorded and that you’ll report any FDCPA violations to the Federal Trade Commission, which enforces the act. The recordings are important evidence if the bill collector breaks the law and you file a lawsuit for monetary damages through a consumer attorney.
-Debt collectors cannot lie about things like lawsuits and criminal charges. It’s illegal for a collection agency to say it’s going to sue you unless it truly intends to do so. A collector can’t claim there are charges filed against you unless it’s true. You can’t be battered with false threats about things like being picked up by the police, being thrown in jail, or having your wages garnished or property seized.
Debts are a civil matter, so you won’t be jailed for non-payment of a bill except in very rare circumstances, like ignoring a judgment and having a bench warrant issued against you in certain states. A collection agency can’t take your property or garnish your wages without going to court first.
If you record every call from a collector and get evidence of false threats, you may have grounds for a lawsuit. If you don’t want to deal with the threats, make a cease communication demand. Creditcards.com has an example of such a letter on its website. Use it as a model for your own demand.
Bill collectors generally back off from illegal tactics when they realize that you know your rights. They know there are consumer rights lawyers who are only to eager to sue them on contingency.
Unfortunately, there are fake collectors operating out of foreign countries who don’t respect American laws. Often, the debt they’re harassing you about doesn’t even exist, and they know you can’t take legal action against them, so they continue their extortion attempts. You can read more about this debt collection scam in one of my recent columns.