Collectors are driving me crazy, what can I do?
Do not be intimidated by collectors —keep your calm, don’t make any rash decisions, you have rights within the law that protect you from collection harassment.
The Federal Fair Debt Collection Practices Act, 15 U.S.C. 1692, requires debt collectors to treat you fairly and prohibits certain methods of debt collection. The remedies provided by the Act include damages and attorneys fees up to $500,000 or 1% of the total Net Worth of the Collection Agency, whichever is less.
To begin with, the Act requires collectors to send you a written notice that includes, among other things, the amount of the debt, the name of the creditor to whom the debt is owed, and a statement that, if within thirty days of receiving the notice the consumer disputes the debt in writing, the collector will obtain verification of the debt and mail it to the consumer.
In other words, collectors have to first notify you the details of the debt in writing, if not, they are violating the law. Let them know.
After receiving this first notice in writing, consider disputing the alleged debt to obtain the documents that verify their claim. Do not delay —you only have 30 days to answer with a certified letter with receipt-request, before losing your rights.
Then, collectors have the obligation to send you a second letter verifying the debt. The creditor has the burden of the proof to produce the documents that serve to attest that you owe this debt, and it is a well known fact, that unscrupulous collectors have a tendency to inflate the final debt amount with unsupported penalties and fees. The collector has to provide the original contracts where you agreed to these penalties and fees.
The Act further expressly prohibits the following practices:
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;
- Call you before 8:00 AM and after 9:00 PM;
- Call you at work, if your employer forbids these contacts;
- Reveal alleged debt to third parties.
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.
You might want to take a look at some additional protections and advice provided by the the FTC in their Fair Debt Collection brochure.
So, what do you do if you’re being annoyed by collectors?
Send them a certified letter - receipt requested, asking them to stop contacting you.
There are a couple of things that you should be aware of in order to be able to stand on higher ground while negotiating:
- Time is on your side, the longer it takes to renegotiate your debt, the better off you are. For instance, the original creditor will sell its debt at a couple of pennies on the dollar to debt collectors after a few months. Hence, collectors will be willing to settle for much less than the original creditor. Consider also, that if you are planning to file for bankruptcy due to diminished earnings —job layoff—, the means test on your income is computed on your last 6 months, so it’s in your best interest to hold your filing till the 6 month period is met.
- Keep a record of the times and what the collector said during their calls, as well as any other form of communication —it may well be worth the effort, if you decide later on to sue the collector for violations to the 15 U.S.C. 1692.
- If the collector persists in harassing you, consider not supplying information requests —nor acknowledging the debt.
- You might counter by letting them know that they have not complied with the law by neither providing you with a written debt notice nor the required verification of the debt letter, if you disputed the debt. You have the right to refuse collection from someone that has not proved to you that he is the rightful owner of the debt and that the alleged amounts are the correct ones.
Bottom line, don’t panic, collectors prey on your emotions, time is on your side, you can stop their harassment.