Debt issues can be hard to manage. And a collection call from a persistent creditor can make a challenging financial situation all the more stressful.
The good news? You’ve got debt collection rights, and lots of them — thanks to the Fair Debt Collection Practices Act. This federal law sets down a specific set of rules that third-party debt collectors must follow when contacting you about a debt that was sent to collections. Debts covered under this law include auto loans, medical bills and credit card bills.
To help you understand your debt collection rights, here are 10 important rules a debt collector must follow when contacting you about an unpaid bill.
1. No Early Mornings or Late Night Calls
A debt collector may not call you before 8 a.m. or after 9 p.m. (in your time zone) unless you specifically ask them to call during these times. Whatever debt you may owe, you still have the right to a quiet morning and a quiet evening.
Keep in mind that debt collectors can contact you by phone, letter, email or via text message, but it’s the calls that are restricted during this time. The Fair Debt Collection Practices Act does not specify any restrictions about receiving text messages, as they weren’t around when the act was passed in 1977.
2. No Calls at Work, Once You Request It
Once you let a debt collector know not to contact you at work, they are legally required to stop doing so. If your employer doesn’t allow personal calls, or you simply shouldn’t be bothered while you’re at the office for any reason, it’s a good idea to make that clear to a debt collector right away. You can inform the collection agency of this restriction either in writing or verbally.
3. No Repeated or Continuous Calls
Debt collectors may not call you numerous times a day about an unpaid debt. This is considered a form of harassment by the Federal Trade Commission (FTC) and is explicitly not allowed. It is also within your debt collection rights to inform a collection agency that you disagree with what they’re claiming you owe — and once you’ve done so, in writing, they’re required to stop contacting you while the debt is verified (more on that later).
4. No Verbal Abuse
Another form of harassment that is strictly off limits, according to the FTC, is abuse. A debt collector may not use threatening or profane language when contacting you about a debt. No debt collection agency representative is allowed to falsely imply that you have committed a crime by failing to pay your debt. They may not call you names or verbally abuse you in any way, either.
5. No Informing Friends, Neighbors, Coworkers or Family Members About a Debt
A debt collector may contact people that know you, but only to find out your address, your phone number and where you work. In most cases, a debt collector may not tell anyone other than you, your spouse or your attorney that you owe money.
6. No Collecting on a Debt Larger Than the Consumer Actually Owes
Part of your debt collection rights are that a debt collector may not demand more money from you than you actually owe. When the debt collector sends you the written debt validation notice (more on that later), it must include the specific amount they claim you owe. A debt collector cannot legally say (or threaten) that you owe more.
7. No Dire Threats
No one from a collection agency can threaten you in any way. This includes everything from threats of violence to taking property or having you arrested if you do not pay your debt. Debt collectors also may not threaten to sue you, unless they actually intend to file a lawsuit. (Note: If a debt collector or creditor does sue you to collect on what you owe and wins the lawsuit, the courts will likely enter a judgement against you. This will inform what you owe and allow the debt collection agency or creditor to garnish your wages.)
8. A Debt Collector Must Send Written Notice of Debts
As we mentioned earlier, as part of the debt collection process, you must receive a statement outlining the specifics of your debt in collections. Within five days of contacting you, a debt collector must send you this written notice with the amount of money you owe and the name of the creditor. This notice also must explain what actions to take if you believe you do not owe money.
9. A Debt Collector Must Honor a Written Request for No Further Contact
A debt collector must cease contact with you if you send a letter requesting that they do so. If you believe you do not owe the money, you may state this in your letter. Be aware that a legitimate debt will not go away simply because the collection calls stop. If you don’t pay your verified debt, you could still be sued by the debt collector or your original creditor for the amount you owe.
10. The Debt Collector Must Verify All Disputed Debts
If you dispute a debt because you don’t think you owe the money or the amount is incorrect, the debt collector must stop calling you while this is investigated. Debt collectors must verify any debt you dispute in writing prior to renewing collection calls. Once a debt collector sends you verification of the debt, collection activities may resume.
Protecting Your Debt Collection Rights
These are some of the most important consumer rights under the Fair Debt Collection Practices Act. Simply informing a debt collector you are aware of these rights may curb any errant collection behavior.
If a debt collector breaks any of these rules when contacting you about a debt, you can (and should) report the debt collector to your state attorney general’s office, the Consumer Financial Protection Bureau and/or the Federal Trade Commission. Many states have their own collection laws, and a debt collector who violates the federal Fair Debt Collection Practices Act may be violating state collection laws as well. Your state attorney general’s office will be able to inform you of any additional local rights you may have.
Remember, the very first person who must stand up for your debt collection rights is you. So don’t let a debt collector intimidate you or harass you with unfair and illegal tactics. Dealing with a debt collector who plays by the rules may be a stressful experience as well. If you need specific assistance and advice, consider contacting an attorney.
The Consumer Protection website from the Federal Citizen Information Center includes links to state and local consumer protection agencies around the country, including state attorney general offices. You may also report any problems you encounter with a particular debt collector to the Federal Trade Commission by visiting ftc.gov or by calling 1-877-FTC-HELP (1-877-382-4357).
For help handling calls from a collection agency, you may want to contact an attorney. Although this is not required, doing so can help make sure everything is being handled in a legal way. Part of your debt collection rights include that the debt collection agency must contact your attorney, once you’ve hired one, instead of you, which may help to alleviate some of the stress.
LawHelp.org connects low- and moderate-income Americans with free legal aid programs in their communities. And the American Bar Association has a consumer guide that provides a directory of legal resources available in each state. You may also be able to find an attorney with debt collection experience through the National Association of Consumer Advocates. This nonprofit association of attorneys and consumer advocates has members throughout the country.
How a Debt in Collections Affects Your Credit
If you have a debt in collections, it’s a good idea to see how it’s affecting your credit. It’s easy and free to do so, too. You are entitled to a free copy of your credit reports from each of the three main credit bureaus — Experian, Equifax and TransUnion — every 12 months. You can access them by visiting AnnualCreditReport.com.
As you pay off your debts, you can see how it’s impacting your credit by taking a look at your free credit report snapshot on Credit.com. This will give you insight into two of your credit scores. You’ll also see a breakdown of how each of the five factors that make up your scores — payment history, debt usage, variety of accounts, age of credit accounts and credit inquiries — are affecting your scores.
Additional reporting by Lucy Lazarony.