How to Handle Bill Collectors - Part One

Bill Collectors and Your Rights

You can get behind in your debts for any number of reasons. It could be a simple case of living beyond your means or it could be due to an uninsured illness or job loss.

It doesn’t matter to your creditors; they lent you the money and now they want it back.

Most lenders will try to work with you for a while and its best to try to negotiate with them at this stage.

Unfortunately at this point, the creditor still has lots of options, like law suits, available and may be unwilling to negotiate. A threat of bankruptcy might get their attention.

If you can’t work something out or just don’t pay your debts, the creditor will then send your file to either an in-house bill collector or, more commonly, to an outside collection agency.

Bill collectors are a tough bunch. They have heard all the sob stories and aren’t interested in yours. Mostly. they get paid on commission, so they just want to get money out of you and move on.

There aren’t many laws to get you off the hook as far as the debt goes (bankruptcy is your only choice). But there are laws that prevent harassment and abuse by bill collectors.

Debt collectors tend to try to ignore these laws, but if you know your rights and insist on them, at the very least you might be able to collect damages if the bill collector persists in ignoring them.

Your Rights When Dealing with Bill Collectors

The major law protecting you is the Federal Fair Debt Collection Practices Act. Some states have their own versions of this law.

The law does not prevent a bill collector from contacting you, but it must be at convenient times. Contact can’t be before 8 a.m. or after 9 p.m., unless you agree. A debt collector also may not contact you at work if you tell him that your employer disapproves of such contacts.

If you don’t want to be harassed, get the name, address and telephone number of the bill collector. Then send a certified letter, return receipt requested telling the collector to leave you alone.

Once the collector receives your letter, he can not contact you again, except to say there will be no further contact or to notify you that the bill collector or the creditor intends to take some specific action against you, such as sue you or report your delinquency to a credit bureau.

The bill collector can contact friends, relatives or neighbors only to find out where you are. They are not supposed to be spreading the word that you’re past due on your debts.

Within five days of first contact, the collector must send you a written notice telling you the amount of money you owe and the name of the creditor to whom you owe the money.

The notice should also tell you what action to take if you believe you do not owe the money. You have 30 days to dispute the debt, in writing (certified mail RRR again). The bill collector is then not allowed any other contact with you until he is able to send you proof of your debt.

For more information, read part two and part three of this article where the Fair Debt Collection Practices Act, negiotating with bill collectors and "zombie" bill collectors are discussed.

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