Dealing with debt in collections can quickly induce stress. The phone rings non-stop and they continually demand money. But if you could afford to make all of your debt payments, you would.
If you have a debt that has gone to collections and you must deal with a collection agency, there are a few things you need to know. Read on…
Debt Collectors Must Follow the Law
Debt collection agencies must abide by the Fair Debt Collection Practices Act (FDCPA), which is a federal statute designed to protect consumers from abusive debt collection practices. The FDCPA applies to third-party debt collectors who are attempting to collect debts on behalf of someone else but does not apply to original lenders.
The unfortunate truth is that the debt collection market has a high risk of fraud and abuse. It is not uncommon for debt collectors to push the boundaries of the law―or downright violate the law.
Under the FDCPA:
- A debt collector may not call you before 8 a.m. or after 9 p.m., local time where you’re located. 15 U.S. Code § 1692c.
- A debt collector may not harass, oppress, threaten, or abuse you. 15 U.S. Code § 1692d.
- A debt collector may not use false, deceptive, or make misleading representations in connection to collecting on a debt. 15 U.S. Code § 1692e.
- A debt collector cannot threaten you with arrest or imprisonment. 15 U.S.C. § 1692(e)(4).
- A debt collector cannot threaten to take any collection action, such as filing a lawsuit or wage garnishment, unless the action is lawful and the debt collector intends to actually take such action. 15 U.S.C. § 1692(e)(5).
- You have the right to stop collection phone calls. Once you notify a collection agency in writing that you do not want to receive phone calls, they cannot legally continue to call you except under specific and limited circumstances. Send the debt collector a letter telling them to stop calling you.
If a debt collector violates the law, we encourage you to report their illegal actions to the U.S. Consumer Financial Protection Bureau and your state attorney general’s office.
Your credit report may show a “charge-off” account. A charge-off occurs when the creditor determines that the debt owed is unlikely to be collected, writes the accounts off as a loss, and closes the account to future charges.
After a creditor has charged-off an account, they may transfer or sell the debt to a collection agency. When this happens the collection agency will then attempt to collect on the debt and will also report the account and the balance owed on your credit report. Remember that the debt collection agency must comply with the federal Fair Debt Collection Practices Act. If they do not, they are violating your rights.
Facing Your Debt Problem
If you’ve got debt in collections, it is time to face your debt problem. Ignoring the problem will only make it worse. Eventually, you may be sued for non-payment, which can lead to wage garnishment and bank levies. You have options to get out of debt.
If you are deep in debt that you simply cannot afford to pay back, it is time to explore how bankruptcy can stop collection actions against you and get you out of debt.
Exploring Your Debt Relief Options
At the Law Office of Barbara B. Braziel, we are committed to helping people get out of debt and gain the financial freedom they deserve. We invite you to learn more about who we are here. If you live in Savannah, GA or the surrounding areas and have questions about your debt relief options, let’s meet for a free consultation.
Find out more about being debt free in our guide: All About Debt Relief
We are a debt relief agency. We help people file for bankruptcy relief under the U.S. Bankruptcy Code.