Write To The Collector To Request It Stop Contacting You
Under the federal FDCPA, if you request that a debt collector stop contacting you completely, it must do so, subject to a few exceptions. Your request must be in writing. You can send a letter by mail, return receipt requested , stating that you want the collection agency to stop all contact with you. You can also send this letter electronically if the collector uses that way of accepting communications from consumers. So, if the debt collector accepts emails from consumers, you can send your message via email.
But think carefully before you tell a collector to cease communicating with you. If you want to keep tabs on the debt status or open up the lines of communication with the collector to negotiate a settlement, a cease communication directive might not be in your best interest. If you ask the collector to stop corresponding with you, it can’t contact you except if it’s serving you with a lawsuit or taking another legal action. Keep in mind you can ask the collector to stop just some kinds of collection contacts, like to certain phone numbers or at specific times of the day.
However, if you’re thinking about filing for bankruptcy, telling the collector to stop contacting you might be a good idea. Once you file, an order called the “automatic stay” goes into place. The stay stops most collection calls, but collectors can still call before you file.
A Thing To Remember About Debt Collectors
Debt collectors usually buy debt in bulk. The collector whos calling you may be working through a stack of hundreds or thousands of debts purchased at the same time. Collectors pay an average of four cents for every dollar of debt that they buy.That means two things.
- Collectors may not have complete records. Documents and files get lost or mixed up, especially when collectors buy debts from other collectors .
- Collectors dont expect to collect all the debt they buy. Some wont be collectible at all, and when they do collect it often wont be the full amount. Because they pay so little for the debt, they can still make a profit.
Those facts can work for you. A collector may not be able to prove that the debt is yours. Even if they can, they will probably accept less than you actually owe.Debt collectors are like any other predator: they go after the weakest target. Dont be that target. Dont be intimidated, dont apologize, dont admit anything. When you communicate with debt collectors you should know your rights and be firm. Well give you some statements that you can use at different stages in the process.
Never admit that your debt is legitimate or that you owe it. Whether its in writing or on the phone, always treat the debt as a matter of dispute.
Always Take The Initiative
If debt collectors are pursuing you the worst thing you can do is nothing. Dont hide, dont pretend theres nothing wrong, dont try to avoid them. They will find you.
When you communicate with debt collectors its important to take the initiative. If a collector calls, you tell them what you are willing to talk about. Dont admit anything. Respond promptly to every communication. Show them that you know your rights. Use the right letter for each situation. Dont be intimidated and dont make yourself an easy target.
Always stay organized. Its easy to panic and forget to save letters or make notes of calls. Debt collectors will use that panic against you if you let them.
One more time: Never admit that you owe a debt, verbally or in writing. Always treat the debt as a contested matter, even if youre offering to settle it.
Its never easy to communicate with debt collectors, but if you make the right moves you can come out of the situation with the least possible amount of damage!
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Responding To A Debt Collection Case
The summons states when the defendant has to file a response to the complaint. Usually, the summons tells the defendant they have 21 days or 30 days to respond to or “answer” the complaint. The answer is the defendant’s chance to agree or disagree with each of the plaintiff’s statements in the complaint, and to make any affirmative defenses, or to file a counterclaim. If the defendant believes that the plaintiff has violated the FDCPA, the defendant can consider filing a counterclaim.
The debt collector may have the papers served on the defendant before they have started a case with the court. This can be confusing for a defendant who wants to file an answer right away, but the court cannot find any case filed in its system.
Utah Rule of Civil Procedure 3 says the plaintiff must file with the court the complaint, summons and proof of service within 10 days of serving the defendant. The defendant can try contacting the plaintiff’s attorney to discuss the complaint. The defendant can check with the district court of the county where the case will be filed to confirm that the plaintiff has filed the case. See our web page on filing procedures for more information on counting time.
Collectors Taking Money From Your Wages Bank Account Or Benefits
Debt collectors can only take money from your paycheck, bank account, or benefitswhich is called garnishmentif they have already sued you and a court entered a judgment against you for the amount of money you owe. The law sets certain limits on how much debt collectors can garnish your wages and bank accounts. Certain federal benefits, such as social security benefits and veterans’ benefits, generally cannot be garnished. For more information about garnishment and what you can do if your bank account or benefits are garnished, see the FTC’s “Garnishing Federal Benefits”.
If you get a summons notifying you that a debt collector is suing you, don’t ignore it. If you do, the collector may be able to get a default judgment against you and garnish your wages and bank account. If you are sued by a debt collector, you may want to consult an attorney to discuss your options.
For more information about debt collection and your rights, visit the following:
- FTC’s Dealing With Debt: Information about managing debt, credit repair, and different debt collection issues.
- CFPB’s Debt Collection: Common questions about debt collection.
- FTC’s Fake Debt Collectors: How to tell if a debt collector is legitimate or a fraudster.
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Resolving The Case Outside Of Court
Resolving a case outside of court can save time and money.
Settlement
The parties can settle the case at any time in the process. The debtor can contact the creditor’s attorney to see if they are willing to negotiate.
One example of a settlement is a payment plan, where both sides write an agreement that they debtor will pay the creditor a certain amount each month for a certain period of time. The amount could be the full amount owed, or it could be for something less than the full amount. The written agreement between the parties becomes an enforceable contract. If the debtor does not follow the contract, the creditor may file a new lawsuit to enforce the payment plan contract.
In some hardship cases , the creditor may be willing to discuss the hardship with the debtor to reach a resolution of the debt.
Mediation
The parties can hire a mediator to help them work through their dispute and to try to come to an agreement. See the Alternative Dispute Resolution page for more information about the process.
What Debt Collectors Cant Do
Debt collectors are regulated by the Texas Debt Collection Act. Among other things, the Act prohibits debt collectors from:
Using abusive collection tactics, including:
- threatening violence or other criminal acts
- using profane or obscene language
- falsely accusing the consumer of fraud or other crimes
- threatening arrest of the consumer, or repossession or other seizure of property without proper court proceedings
- using the telephone to harass debtors by calling anonymously or making repeated or continuous calls
- making collect telephone calls without disclosing the true name of the caller before the charges are accepted
Using fraudulent collection tactics, including:
- using a false name or identification
- misrepresenting the amount of the debt or its judicial status
- sending documents to a debtor that falsely appear to be from a court or other official agency
- failing to identify who holds the debt
- misrepresenting the nature of the services rendered by the collection agency or the collector
- falsely representing that the collector has information or something of value in order to discover information about the consumer
- Trying to collect more than the amount originally agreed upon. .
Violators of the Texas Debt Collection Act are subject to criminal and civil penalties. If you think you have been harassed or deceived, you can even seek injunctions and damages against debt collectors.
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What To Do When A Debt Collector First Contacts You
Regulation F has redefined the way debtors communicate with debt collectors and given debt collectors new responsibilities. One of the most noticeable changes is in the letter that a debt collector must send you within five days of their first contact with you. This letter is called a Debt Validation Notice.
Before we get into how to handle the Debt Validation Notice theres one thing you should remember about debt collectors and how they work.
Do You Need To Notify Credit Bureaus Of Paid Collections
Once you’ve paid off or settled debt that’s been in collections, you don’t need to notify the three national credit bureausExperian, TransUnion and Equifax. That’s because the debt collector is supposed to report the wiped-out debt to the bureaus, which will list it as either “paid” or “settled.”
What if the debt collector doesn’t tell the credit bureaus that your debt has been paid or settled? File a dispute with the bureaus so that your credit report can be updated.
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How To Contact Creditors And Collection Agencies The Best Way
When you’re in debt and cannot afford the payment, don’t wait for the creditors or the collection agencies to contact you. Instead, you should contact them and ask for a new repayment plan.
Negotiate debts with your creditors. Your creditors shouldnt always be avoided as theyre the ones who can help you make the best decision with your debt accounts. Speak to them and tell them about your present financial status so that they can alter the repayment term for you and make it favorable for you to pay off.
This article gives you an idea of how to contact creditors/CAs to negotiate for the repayment plan.
How Debt Collectors Get Your Information
When you havent paid a debt to a creditor , they may sell it to an agency or hire an agency to collect the debt on their behalf. The responsibility of collecting the debt then falls to the collection agency.
The creditor will likely pass along some of your personal information like your address and phone number so that the collection agency can contact you. If this information is incorrect, they may also try an internet search to find your current contact information.
If a debt collector got your information from the original creditor, theyll have your personal details, such as where you live, the amount owed and the company you originally owed money to. If youre dealing with legitimate debt collectors, they should have no problem sharing information related to your debt.
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What Should I Do When A Debt Collector Contacts Me
There are different ways to respond appropriately to debt collectors. Depending on your situation, we have sample letters you can use if you’re experiencing common problems.
When contacted, find out the following:
- Identity of the debt collector, including name, address, and phone number
- The amount of the debt, including any fees such as interest or collection costs
- What the debt is for and when the debt was incurred
- The name of the original creditor
- Information about whether you or someone else may owe the debt
When a debt collector first contacts you in writing regarding a debt, it must provide you a written notice that has certain, legally-required information. If the collection agency first contacts you by phone, insist that they contact you in writing. Do not give personal or financial information to the caller until you have confirmed it is a legitimate debt collector.
The following sample letters will help if youre experiencing common problems that may come up with debt collectors.
How Long Do You Have Before A Collection Agency Reports To Credit Bureaus
Debt collectors can report your information to credit bureaus after following certain rules for informing you about the debt. If your debt has been handed over to a collection agency, and the agency has contacted you personally or sent you a validation notice, you should expect that information to be reported almost immediately. Grace periods are typically reserved for those with an otherwise good credit history, such as someone who missed a single payment and settled it within a few days.
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If Contacted About A Debt
If a debt collector contacts you, do not give out any personal information until you first:
- Request verification of a disputed debt in writing.
- Check the licensing status with the DOB of a debt collector or the Bar status of an attorney.
Once you have confirmed the debt and verified the debt collector you should:
- Create a paper trail. Keep a record of the date, time and name of the individual contacting you. Put your requests and responses in writing.
- If you do in fact owe the debt, plan to repay any undisputed obligation. Set up a payment plan you can maintain and provide that to the creditor or debt collector in writing.
Dont Provide Personal Details Over The Phone
Debt collectors are very good at providing pressure. They move quickly, cast a shadow of doubt on your future, and often speak in threatening tones.
Despite these tactics, you should never provide personal details over the phone. In fact, federal law protects you from ever needing to give out private information to anyone.
Instead of divulging personal information over the phone, insist that all requests be made in writing. This will provide a paper trail for you to keep records and protect your privacy.
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Common Defenses In A Debt Collection Case
If the defendant believes they have a legal defense to the debt collection case, it is important to say that in the answer.
Some examples of common legal defenses include:
- The account is not the defendant’s account.
- The defendant legally cancelled the contract and so does not owe anything, or the creditor cancelled the contract and so is not entitled to payment.
- The claims are barred because they were brought after the six-year statute of limitations period for actions based on a contract passed, or another applicable statute of limitations has passed.
- The debt has been paid or excused so the claims are barred by accord and satisfaction, discharge, waiver, or release.
- The defendant is entitled to an offset for amounts that they have paid or that should otherwise be credited to the defendant.
- The defendant was a co-signer but was not informed of their rights as a co-signer.
The inability to pay a debt is not a legal defense to the debt. For a more comprehensive listing of legal defenses, see the Debt Collection Answer form.
Payday Loans Irs Imposters And Debt Collection Scams
The Attorney General’s Consumer Protection Division is receiving an increase in the number of consumer calls and complaints related to aggressive debt collectors attempting to collect on outstanding payday loans and bogus IRS tax debts. Generally, callers claim to be from the IRS, law firms, government agencies, or even law enforcement agencies. They demand payment on outstanding IRS taxes or payday or internet check cashing loans. They may make caller ID information appear as if the IRS or other government agency is calling. Often, the callers use many of the “debt collector don’ts” outlined above, and call consumers unceasingly at all hours of the day and night at home or on cell phones, at work, and may even contact neighbors and relatives.
These calls are especially frightening because they often have accurate information about the consumers they target, including Social Security numbers, dates of birth, address, employer, and bank account information, and even the names and contact information of neighbors and relatives.
The common thread among these vicious debt collection scams is that the callers demand immediate payment , refuse to send you any written proof of an outstanding debt, and often threaten legal action or physical violence if the consumer refuses to pay.
If you receive calls such as these:
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What Should You Do If You Think A Collector Is Breaking The Law
If you suspect the collector is a scammer, is violating the law or continues contacting you after receiving your written notice, you should file a report with the FTC, the CFPB and your state attorney generals office.
Having a debt in collections can cause long-term damage to your credit scores, so its best to avoid this situation by staying on top of your payments, whenever possible. However, if you do find yourself dealing with debt collectors, its vital that you know your rights.
