The Federal Trade Commission (FTC) defines a debt collector as any person who regularly collects or attempts to collect a debt owed including a creditor who uses a third party to collect a debt.
Consumers should learn their rights regarding credit and debt collection to prevent harassment, prevent paying additional fees or money that is not owed and to protect their credit. The main act that protects consumers regarding debt collection is the Fair Debt Collection Practices Act (FDCPA) which can be found on the FTC website at ftc.gov/os/statutes/fdcpajump.shtm.
The FDCPA covers individuals, families and debt owed for medical bills, mortgages, car loans and personal credit cards. The act does not cover debts business debts owed. A debt collector can only contact you between 8am and 9pm. They can contact you at any number you provided on your credit card or loan application unless you tell them in writing or over the phone to stop contacting you at that number. A debt collector can contact other people to get your contact information if they are unable to find you or do not get a response from you. They are prohibited from contacting third parties more than once.
According to CNN Money the number of complaints against debt collectors threatening to use violence or using violence increased by more than 50% since 2009 to 2,517. Complaints against debt collectors using abusive language increased to 35% in 2009.
Debt collectors cannot ask for more money than what is owed, threaten violence, legal actions, jail, job loss, or property seizure. A debt collector must sent a written letter stating how much you owe within 5 days from the first time they contact you and must include the name of the original creditor owed, and the process to follow if you feel you do not owe the debt.
If you feel you do not owe the debt, send a written response with a return receipt within 30 days of receiving the letter requesting proof that you owe the debt. A debt collector cannot contact you again until proof has been sent. Here are some highlights of what debt collectors cannot do:
Debt collectors cannot: harass you with threats of violence or publish your name, use profanity, make obsessive phone calls, make false statements or send false documentation, misrepresent the amount owed or the company they work for, cannot state you will be arrested if you don't pay your debt, may not give credit information about you to anyone including a credit reporting company, may not collect fees or other charges on top of the amount owed unless the contract states so or contact you by postcard.
If you do not pay a debt owed, a creditor or debt collector can: sue you or garnish your wages. However, debt collectors cannot obtain garnishments from: social security, SSI or veterans, military, railroad retirement, foreign service or disability benefits, merchant seamen wages or FEMA disaster assistance.
If you feel a debt collector has violated the FDCPA you can sue them in a federal or state court within one year from the date the law was violated. If you win, the judge can require the debt collector to pay you for damaged incurred up to $1,000. Complaints can be filed against a debt collector with the FTC.
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