“The only man who sticks closer to you in adversity than a friend is a creditor.”
-Unknown
Debt collectors are after one thing—your money.
And if you borrowed money, then you are obligated to pay it back. Collectors have the right to call you and ask you to pay back the money you owe.
The problem is most of them will say anything—and I mean anything—to make you pay your bills. They don’t care whether you feed your family and keep your lights on. All they want is to be on the top of your who gets paid first list. Nothing else matters to them.
Their job is to make you angry or scared—and they do it well. They know that if you get all worked up, you will act on that emotion and do something stupid, like pay them instead of buying groceries.
Collectors have a plan, and so should you. Stay calm. Don’t let some kid in a cubicle 500 miles away take control of your life.
Debt collectors have guidelines called the Federal Fair Debt Collection Practices Act—but from the stories we hear, it seems like many of them skate around these rules at best, and ignore them at worst.
Here are some of the basics that you should know about the Federal Fair Debt Collection Practices Act:
- The Act states that harassment is illegal, and it restricts a collector’s calls to between the hours of 8 a.m. and 9 p.m. (unless they have your permission).
- The Act also allows you to demand that a creditor cease calling you at work. You should request this in writing by certified mail with return receipt requested.
- No collector or creditor may access a bank account or garnish wages without proper and lengthy court action, except in the case of delinquent IRS or student loan debt. All such threats are a bluff.
- Collectors cannot contact third parties—such as family or neighbors—more than once about your debt, and they cannot discuss the details of your debt. This is illegal but not uncommon practice.
- Do not use a cease-and-desist letter except in horrible situations, because all negotiations stop and any hope of positive resolution is lost.
You can read more about your rights and the limits of collectors by visiting the Federal Trade Commission’s website.
Keeping good records on every collection contact is crucial. In addition to sending correspondence through certified mail with a return receipt, you should also take notes on phone conversations. These notes should include the name of the collector, the date and time of the call, points covered during the discussion, and the agreed-upon plan of action. Always try to talk to the same person to avoid the risk of having to start from
the beginning with each call.
Communicating clearly with collectors is very important. Financial expert (and former debt collector) Chris Hogan stresses the importance of the role of communication in the process and offers these three tips:
• Don’t avoid collectors!
• Speak facts when dealing with collectors.
• Script out some notes ahead of time so you feel more prepared.
If collectors are violating the FDCPA and harassing you, then assert your legal rights. You should notify the Federal Trade Commission and their state’s attorney general or Department of Consumer Affairs in writing, including the recorded information about the harassing phone calls if possible. As with all correspondence, these letters should be sent by certified mail with a return receipt request. This provides proof that the notification was delivered and received. Using certified mail with a return receipt is a good practice for all communication between the consumer and the creditor. To report unfair collecting practices, visit the Federal Trade Commission’s website.
Remember that the absolute best way to not have to deal with these people is to not let yourself get into this position in the first place. But this should help.
Stay Loose
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