Fair Debt Collection
courtesy FTC
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."
You should know that in either situation,
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.
This brochure answers commonly asked
questions about your rights under the Fair Debt Collection
Practices Act.
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.
|
