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From the Experts at Credit.com

Understanding Your Debt Collection Rights

August 8, 2013

Debt Collection Rights

You just gave a telemarketer your credit card number. Or you owe a bank money for your new car or family home. Maybe you are falling a bit behind on your payments, or maybe someone else claims you are falling behind - but you're not. You may be receiving phone calls from the bank, credit card company or collection agency. Sound familiar? No fun, is it?

There are things you can do to make sure you are a bit more in control of those pesky debt collectors. Read our summary of the Fair Debt Collection Practices Act, passed by Congress to protect consumers like you from illegal debt collection activities today.

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15 U.S.C. §§ 1692 - 1692o
This information was updated as of June 2, 2005 and is believed to be accurate as of this date. We assume no responsibility to update this information.

The Fair Debt Collection Practices Act (the Act) was passed by Congress to protect consumers by making some debt collection activities illegal. Some of those practices and activities which are illegal are described below. (15 U.S.C. § 1692e.)

Definitions used on this page:

If you owe money or use a credit card, you are a Consumer. ( 15 U.S.C. § 1692a(3).) Consumer also means your spouse, parent, if you are a minor, guardian, executor or administrator. (15 U.S.C. § 1692c(d).)

If you owe a Debt, you owe money to a Creditor for anything that you owe for personal, NOT business or commercial purposes. (15 U.S.C. § 1692a(5); § 1692c(d).)

If you ever fall behind in paying your Creditor you may be contacted by a Collector. A Collector might be an individual, an attorney, or a company, who ordinarily receives a payment from your Creditor for collecting on your overdue payments. A third party Collector collects Debts owed to someone else - your Creditor. (15 U.S.C. §1692a(6).)

How it works:
Can Collectors contact you? If, so, when can they contact you?
Can Collectors contact your family, friends or work-place?
Can you stop the Collector from contacting you?
What if you have an attorney?
What should a Collector tell you about the Debt?
What if don't you think you owe money to the Creditor?
What if the amount is incorrect?
What if you owe multiple debts?
What happens during the 30-day dispute period?
What can a Collector say? What they may not say.
What to do if you think a Collector broke the law?

Can Collectors contact you? If, so, when can they contact you?

Yes. Collectors may contact you in person, by telephone, fax, mail, or telegram. Collectors may not contact you at unusual times or places such as before 8:00 a.m. or after 9:00 p.m. unless you tell the Collector that they may contact you at any time. (15 U.S.C. § 1692c(a)(1).)

In general they may not contact you if you tell them you have an attorney and your attorney is handling your debt(s) for you. (See What if you have an attorney?) (15 U.S.C. § 1692c(a)(2).)

TIP: It would smart to keep track of all of the communication between you and the Collector including his or her name, the date of the communication, and what you discussed. (See What should a Collector tell you about the Debt?)

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Can Collectors contact my family, friends or work-place?

A Collector may not contact anyone else to discuss the Debt with them. Collectors may contact other people, one time only, to find out where you live, work and what your phone number is. (15 U.S.C. §1692c(b).)

A Collector may not:
Contact another person more than once --unless that person tells the Collector it is okay to call again; or
Tell the person he contacts that it is in the debt collection business; or
Send them a postcard or any type document with any information or marks on the envelope that may communicate that the Collector's purpose is to collect a debt.
(See What can a Collector say? What they may not say.)

A Collector may only make contact once with your employer. A Collector who has not contacted your employer can send a letter asking for verification of your employment. . Collectors are not allowed to ask your employer or co-workers personal information about you. If the Collector contacts your work-place more than one time, for the same purpose, you may tell the Collector not to phone you at work because your employer does not want you to receive those kinds of calls at work. (15 U.S.C. §§ 1692b-c)

Your friends and family may tell the Collector not to phone them any more after the Collector has phoned there the one time allowed under the Act. The Collector is not allowed to continue contacting them unless they tell the Collector to continue the contact. (15 U.S.C. §§ 1692b-c)

NOTE: Telling a Collector "don't call," will NOT make the Debt go away - it only prevents the Collector from hassling you.

A Collector may contact your attorney, if you have one, and discuss the Debt with your attorney. (15 U.S.C. §§ 1692b(6).) (See also What if you have an attorney?)

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Can you stop a Debt Collector from contacting you?

Yes, but only if you write them a letter telling them to stop contacting you. Be sure to keep a copy of the letter. Once the Collector receives your letter, they may not contact you about the Debt again, except to tell you that the Collector or the Creditor will take a specific action to resolve the Debt. (For example the Creditor may decide to sue you to recover the Debt.) . (15 U.S.C. § 1692c; and § 1692i)

NOTE: Sending a letter to the Collector will NOT make the Debt go away.

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What if you have an attorney?

If you have an attorney helping you settle your Debt, tell the Collector the name of your attorney. If you prefer that your attorney handle the situation, you can tell the Collector not to contact you again. The Collector will not contact you again unless your attorney gives the Collector permission to contact you, or unless your attorney fails to respond to the Collector in a reasonable amount of time. (15 U.S.C. § 1692b(6).)

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What should a Debt Collector tell you about the Debt?

The Collector has 5 days after the first contact with you to:

  • Notify you in writing that you owe the Creditor money;
  • Notify you of your right to dispute the Debt.

The written notice must include:

  • Amount of the Debt;
  • Name of the Creditor;
  • Your right to dispute, all or part of, the Debt, in writing, within 30 days of you receiving the notice.

NOTE: The 30 day time frame starts running on the day you receive the notice NOT the date of the letter or the postmark)

(See also What if you don't think you owe money to the Creditor?)

(15 U.S.C. §1692g.)
NOTE: The purpose of this part of the Act is to help Consumers who might have been mistaken or misidentified. For this reason you must receive written verification of the name of the Consumer, and amount of the Debt as it was obtained from the Creditor.

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What if you think you don't owe money to the Creditor?

If you think you don't owe the Creditor money, you must send the Collector a letter stating that you do not owe the money to the Creditor. You must send this letter to the Collector within 30 days of the date you receive the written notification of the Debt. (See What should a Debt Collector tell you about the Debt?) (15 U.S.C. § 1692g(b).)

You may tell the Collector not to contact you until you receive proof of the Debt. If you decide to do this, you must do it in writing.

Once you dispute the Debt in writing, the Collector must stop trying to collect money from you until you receive written proof that you really owe the Debt from the Collector. Proof should include a written document with your name, and the name of the Creditor and the amount you owe.

NOTE: This will NOT make the Debt go away. The thirty day period is NOT a grace period - it is just a period of time during which the Creditor must prove that you owe the Debt to the Creditor. (15 U.S.C. § 1692g(b).)

TIP: It may take the Collector a long time to get back to you with the proof you request. There is no time limit for the Collector to provide proof. If the Collector cannot provide the proof you request, it may sell the Debt to another company to try to collect from you. If this happens, repeat the above steps again until you get actual proof of the Debt.

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What if the amount is incorrect?

If you don't think the amount of money the Collector is trying to collect from you is the correct amount, you must send the Collector a letter stating that you do not owe the amount of money the Collector is asking you to pay. You must send this letter to the Collector within 30 days of the date you receive the written notification of the Debt. (15 U.S.C. § 1692g(b).) (See also What should a Collector tell you about the Debt? and What if you don't think you owe money to the Creditor? for instructions on what to do next.)

If you negotiated with the Creditor on partial payments, you may be frustrated if the Collector refuses to accept partial payments. The Collector is allowed to demand larger installments in an accelerated time frame. Although this may be frustrating to you, it is not a violation of the law. The Collector is allowed to negotiate its own terms, but the Collector may not make any false statements or use misleading ways to collect a Debt from you. So, if you suggest a partial payment knowing the Creditor will accept a partial payment, the Collector is not allowed to tell you "only full payment is acceptable." (15 U.S.C. § 1692e)

In general Collectors may NOT add interest, fees, expenses or charges of any kind to the original debt. However a Collector may charge an additional amount if:

  • The Creditor included a condition for the fees or expenses in its agreement with you when you incurred the Debt; or
  • If it is allowed in the State where the contract was created;
  • If it is allowed in the State where a judgment was entered.

(15 U.S.C. § 1692f)
(See also What to do if you think a Collector broke the law?)

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What if you owe multiple debts?

If you owe more than one debt and you make a payment to a Collector, the Collector must follow your instructions apply the money to the debt you tell them to apply it to - it cannot apply it to any other debt. (15 U.S.C. § 1692h)

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What happens during the 30-day dispute period?

The 30 dispute period is NOT a grace period. Until you dispute any or all of the Debt in writing, within 30 days of receiving the notice of Debt, (NOT the postmark or the date of the letter) the Collector can continue to try to collect the Debt from you.

TIP: Dispute the Debt immediately. A Collector may report the Debt to a Consumer Reporting Agency, or send you notice of the Debt the same time it sends you a summons to appear in court. If you receive a summons to appear in court after you disputed the Debt in writing -- go to court! Bring a copy of the letter you sent the Collector disputing the Debt, and tell the Judge that the Collector did not send you proof of the Debt. (See also What should a Collector tell you about the Debt?)

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Collectors are required to tell you who they are, who they are collecting for (the name of the Creditor) and the amount of the Debt. (15 U.S.C. §§ 1692d-f.)

They may NOT:

  • Contact you by postcard;
  • Use a false name;
  • Give you false contact information;
  • Tell you owe more than you really do (unless they were given the wrong information from the Creditor);
  • Tell you they work for a credit reporting agency;
  • Tell you are guilty of a crime;
  • Tell you they will sue you if they don't intend to sue you, or don't expect the Creditor to sue you;
  • Tell you they are an attorney if they aren't;
  • Tell you they represent an attorney if they don't;
  • Send you something that looks like an official court document if it is not;
  • Send you papers and tell you the papers are not legal forms if they really are legal forms;
  • Give false information to anyone about you;
  • Tell or threaten to tell anyone about your Debt;
  • Tell you, you will be arrested if you refuse to pay;
  • Harass you by threatening you with violence or harm; (NOTE: Infrequent contacts such as once a week or twice a month may be stressful, but is not harassment under the FDCPA.) (15 U.S.C. § 1692d.)
  • Threaten you, any members of your family, workers, or friends (15 U.S.C. § 1692d);
  • They may not threaten to or publish your name as someone who refuses to pay his or her Debt, except to a Credit Reporting Agency (15 U.S.C. § 1692d.);
  • They may not use obscene language (15 U.S.C. § 1692d.);
  • If you tell them not to contact you in writing, or tell them that you have an attorney, they may not continue to contact you;
  • In most States they may not collect an amount greater than the amount of your Debt. (NOTE: Some states allow an additional charge for Collectors);
  • They may not deposit a post-dated check prematurely; or
  • Threaten to take your property unless the Creditor or Collector can do so legally.

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What to do if you think a Debt Collector broke the law?

Credit.Com encourages you to report any problems you have to:

  • The Federal Trade Commission: The Federal Trade Commission works for consumers to prevent fraudulent, deceptive and abusive business practices. To file a complaint visit http://ftc.gov, or call 1-877-FTC-HELP. (15 U.S.C. §1692l)
  • File a complaint with your state's office of Attorney General. Click here for the Attorney General's office in your state where you can find on-line complaint forms, for filing complaints against Collectors and Creditors who violate the Federal Fair Debt Collection Practices Act and your State's Debt collection and Creditor collection laws: http://www.fair-debt-collection.com/ag-complaint-forms.html
  • You have the right to sue a Collector in either a Federal or State Court within one year of the date the law was violated. If you win your case against the Collector you may recover damages. (15 U.S.C. § 1692i.) You may wish to contact an attorney to help you with this process. If you do not have an attorney or cannot afford one, contact the Local Legal Services provider, or Lawyer Referral Service of the state, county or local bar association near your home.

Consumer Protection is different in every State. The Federal Act does not change the laws of any State Debt Collection Practice unless that law conflicts with any part of the Act. If State law conflicts with the Act, but provides better protection for you, then the State Law applies. (15 U.S.C. §§ 1692a, n.) An attorney can advise you of your rights.

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