Three Ways to Deal with Debt Collectors

Debt collectors resort to overwhelming tactics when contacting those who owe money. If you find yourself dealing with these tactics, there are three key steps to take to ensure you are not forfeiting your rights.

You are not required to pay your debt upon first contact from a collector and it is advisable to receive validating information from the collector before you provide payment or personal information. There are cases of collectors soliciting money illegally and you may fall into a scheme if you are unaware of what is taking place.

Understanding your rights is essential if you want to establish a functioning relationship with a debt collector as there are specific things he or she is not allowed to ask for during your exchanges. The more informed you are of what needs to be done versus what is being requested, the easier it is for you to manage this situation until it has been completely resolved.

Consider Your Options Before Making a Payment

The debt collector you deal with may impose a sense of urgency when contacting you about paying down your debt, as he or she is attempting to pressure you into making payments before you are prepared to do so. You are not required to make a payment upon first request—take the time to assess the terms of the payment outlined by the debt collector to ensure you understand the situation before you proceed.

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Debt collector are working toward meeting a quota and use pressuring tactics to get people to pay a small amount toward their debt to meet this quota. You may inadvertently create further legal issues by paying even a small amount toward the total debt the collector is claiming that you owe.

When a debt collector contacts you, ask for as much information as possible and tell them you are going to contact them later. You do not need to tell them you are going to make a payment shortly and you are not required to provide payment information upon first contact from the collector. Once the initial contact takes place, gather the information you need from the collector and take time to determine if the statue of limitations on your debt has passed already. If the statue of limitations has passed recently and you make a payment to the debt collector, you are at risk of resetting the clock on your debt which may lead to wage garnishment or a potential lawsuit.

Request Validating Information

As you are speaking to the debt collector, request a validation letter to ensure you are working with a legitimate practice. Debt collectors are recruited as third-party agents and are sold the amount of your debt from the original lender, though the debt itself may pass hands several times before reaching the collector who is contacting you for payment. As this happens, the information pertaining to the amount of debt you have amassed may be inaccurate which means you are susceptible to paying more if you agree to the payments automatically without double-checking this information. Follow these step-by-step instructions before providing payment information to a debt collector:

  1. Have the debt collector send you a validation letter including details of your debt, the overall balance of your account, the information for the collection company and instructions on how you can challenge your debt. If you do not receive this letter within five business days, contact the collector directly to request the information again.
  2. As you are waiting for your validation letter, gather the information you have collected pertaining to your debt. This includes a history of payments you have previously made as well as information pertaining to the original creditor. By collecting these documents, you can compare the information contained within the validation letter to the information in your personal records to determine the accuracy of the collector’s records.
  3. Maintain a record of all communication occurring between yourself and the debt collector as this helps establish your case if needed. Request certified mail when you are corresponding with the collection company to ensure proper documentation is being recorded.

Understand Your Rights

After you have received your validation letter, take the time needed to understand your rights as guaranteed by the Fair Debt Collection Practices Act. Under this Act you receive specific protections against debt collectors and can report when the collector is using profane language or making violent threats during your communications with one another. If this happens, file a complaint directly with the Consumer Financial Protection Bureau to ensure the debt collector is being dealt with by the proper authorities.

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In addition to protecting you against the debt collectors themselves, the Fair Debt Collection Practices Act entitles you to the ability to challenge your debt if you find the information inaccurate upon receipt of your validation letter. If you believe the debt is inaccurate, challenge the information within 30 days of receiving first contact from the collection company. The debt collector is not allowed to ask for payment until the challenge has been resolved by either an attorney general or the Federal Trade Commission. You are permitted to challenge the debt after the 30-day window has expired, though you are expected to still make payments to the collection company as the challenge is resolved.

In some instances, you are permitted to send a letter of demand to the collection company requesting that the debt collector cease contact with you if you feel their claims are unwarranted. This protection falls under the FDCP Act as you are entitled to cease correspondence with a debt collector who is incessantly contacting you about making payments toward your debt. If the debt collector misleads you as to who they are, what company they work for or provides you with inaccurate information about the legal repercussions of ignoring your debt, you are permitted to cease contact with them. Your state may offer added protection against these collectors and you may contact your attorney general directly to determine your rights before resuming contact with a collections company.

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