Fair Debt
Collection
If you use credit
cards, owe money on a personal loan, or are
paying on a home mortgage, you are a "debtor."
If you fall behind in repaying your creditors,
or an error is made on your accounts, you may be
contacted by a "debt collector."
The Fair Debt Collection Practices Act
requires that debt collectors treat you fairly
and prohibits certain methods of debt
collection. Of course, the law does not erase
any legitimate debt you owe.
What debts are
covered?
Personal, family,
and household debts are covered under the Act.
This includes money owed for the purchase of an
automobile, for medical care, or for charge
accounts.
Who is a debt collector?
A debt collector
is any person who regularly collects debts owed
to others. This includes attorneys who collect
debts on a regular basis.
How may a debt
collector contact you?
A collector may
contact you in person, by mail, telephone,
telegram, or fax. However, a debt collector may
not contact you at inconvenient times or places,
such as before 8 a.m. or after 9 p.m., unless
you agree. A debt collector also may not contact
you at work if the collector knows that your
employer disapproves of such contacts.
Can you stop a
debt collector from contacting you?
You can stop a
debt collector from contacting you by writing a
letter to the collector telling them to stop.
Once the collector receives your letter, they
may not contact you again except to say there
will be no further contact or to notify you that
the debt collector or the creditor intends to
take some specific action. Please note, however,
that sending such a letter to a collector does
not make the debt go away if you actually owe
it. You could still be sued by the debt
collector or your original creditor.
May a debt
collector contact anyone else about
your debt?
If you have an
attorney, the debt collector must contact the
attorney, rather than you. If you do not have an
attorney, a collector may contact other people,
but only to find out where you live, what your
phone number is, and where you work. Collectors
usually are prohibited from contacting such
third parties more than once. In most cases, the
collector may not tell anyone other than you and
your attorney that you owe money.
What must the debt
collector tell you about the debt?
Within five days
after you are first contacted, the collector
must send you a written notice telling you the
amount of money you owe; the name of the
creditor to whom you owe the money; and what
action to take if you believe you do not owe the
money.
May a debt
collector continue to contact you if you believe
you do not owe money?
A collector may
not contact you if, within 30 days after you
receive the written notice, you send the
collection agency a letter stating you do not
owe money. However, a collector can renew
collection activities if you are sent proof of
the debt, such as a copy of a bill for the
amount owed.
What types of debt
collection practices are prohibited?
Harassment. Debt
collectors may not harass, oppress, or abuse you
or any third parties they contact.
For
example, debt collectors may not:
-
use threats of
violence or harm;
-
publish a list
of consumers who refuse to pay their debts
(except to a credit bureau);
-
use obscene or
profane language; or repeatedly use the
telephone to annoy someone.
False
statements. Debt collectors may not use
any false or misleading statements when
collecting a debt. For example, debt collectors
may not:
-
falsely imply
that they are attorneys or government
representatives;
-
falsely imply
that you have committed a crime;
-
falsely
represent that they operate or work for a
credit bureau;
-
misrepresent
the amount of your debt;
-
indicate that
papers being sent to you are legal forms
when they are not; or
-
indicate that
papers being sent to you are not legal forms
when they are.
Debt
collectors also may not state that:
-
you will be
arrested if you do not pay your debt;
-
they will
seize, garnish, attach, or sell your
property or wages, unless the collection
agency or creditor intends to do so, and it
is legal to do so; or
-
actions, such
as a lawsuit, will be taken against you,
when such action legally may not be taken,
or when they do not intend to take such
action
Debt
collectors may not:
-
give false
credit information about you to anyone,
including a credit bureau;
-
send you
anything that looks like an official
document from a court or government agency
when it is not; or
-
use a false
name.
Unfair
practices. Debt collectors may not
engage in unfair practices when they try to
collect a debt. For example, collectors may not:
-
collect any
amount greater than your debt, unless your
state law permits such a charge;
-
deposit a
post-dated check prematurely;
-
use deception
to make you accept collect calls or pay for
telegrams;
-
take or
threaten to take your property unless this
can be done legally; or
-
contact you by
postcard.
What control do
you have over payment of debts?
If you owe more
than one debt, any payment you make must be
applied to the debt you indicate. A debt
collector may not apply a payment to any debt
you believe you do not owe.
What can you do if
you believe a debt collector
violated the law?
You have the right
to sue a collector in a state or federal court
within one year from the date the law was
violated. If you win, you may recover money for
the damages you suffered plus an additional
amount up to $1,000. Court costs and attorney' s
fees also can be recovered. A group of people
also may sue a debt collector and recover money
for damages up to $500,000, or one percent of
the collector' s net worth, whichever is less.
Where can you
report a debt collector for an
alleged violation?
Report any problems you have with
a debt collector to your state Attorney General'
s office and the Federal Trade Commission. Many
states have their own debt collection laws, and
your Attorney General' s office can help you
determine your rights.
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