How to Handle Bill Collectors - Part Two

The Fair Debt Collection Practices Act

Fair Debt Collection Practices Act Provisions

According to the Federal Trade Commission (FTC) the agency charged with enforcing the Fair Debt Collection Practices Act:

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.

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.

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.

However, as I said before, debt collectors will ignore this law whenever they can. I have heard of many stories of collectors threatening jail or to sue after the statute of limitations has run.

So it is very important that you build a case against harassing debt collectors. Send repeated certified letters outlining what they said or did.

One way to keep them in line is to tell them you are taping the phone conversations. If the collector continues to talk, he’s considered to have consented to the taping.

If you contest the debt, ask that you be sent proof of it in writing. In many cases, neither the creditor nor the collector can produce this.

Check your credit report and, if you see false entries, contest them right away. Read Your Credit Report to learn how.

Fair Debt Collection Practices Act Enforcement

The Fair Debt Collection Practices Act is rather vigorously enforced by the FTC and state attorney generals. Make complaints to both if you feel you being unfairly treated. Also you have a private right of action against the debt collectors. You can sue a bill 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. If you need a lawyer referral, go to National Association of Consumer Advocates website.

Also I would suggest you buy or borrow from the library Money Troubles: Legal Strategies to Cope With Your Debts (Solve Your Money Troubles) by Robin Leonard, if you have a lot of debt. It best to know what you’re facing and how to handle yourself going in.

Remember, even if you can tame the bill collectors, your debts do not go away. The next step will probably be lawsuits and garnished wages.

That is why the best course of action is to negotiate with your creditors from the very beginning. In most cases you will find it easier to talk to your creditor directly rather than to a debt collector.

The creditor will have to pay about a third of what you owe to the collector it he is successful. This leaves some wiggle room. Also customer service personnel at major banks are trained to be more polite, at least at first. So don't dally. Face the problem head on and try to do something about it.

For more information, read part one and part three of this article.

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