What Debt Collection Agencies Can't Do

Debt collectors have a reputation for being unpleasant, harsh, and even frightening while attempting to collect payments from borrowers. In certain circumstances, this reputation is well-deserved. To stop these unpleasant and abusive practices, the federal Fair Debt Collection Practices Act (FDCPA) was passed. In spite of this, some debt collectors break the law. The following are five methods that debt collection agencies are expressly prohibited from using.

1. Pretend to Work for a Government Agency

The FDCPA forbids debt collectors from posing as representatives of any governmental body, including the police. Additionally, they aren't allowed to say they work for a consumer reporting organization.

A Georgia event from 2014 illustrates exactly what debt collectors should not do. Six employees, including the owner, were detained for reportedly accusing customers of fraud and threatening to detain them and charge them with crimes if they did not pay their bills.

The debt collectors allegedly falsely claimed to be employed by federal, state, and local government organizations, such as the Department of Justice and the U.S. Marshals.

2. Threaten to Have You Arrested

Debt collection agencies are prohibited from making false accusations against you or threatening to have you arrested if you don't pay the debt they claim you owe. First off, the agencies lack the authority to issue arrest warrants or order your detention. Furthermore, you won't go to jail for not making timely payments on a credit card debt, mortgage, vehicle loan, or medical bill.

That being said, the judge may issue a warrant for your arrest if you get a valid order to appear in court on a debt and fail to do so. Additionally, you risk going to jail if you don't pay a court fee associated with your debt or if you dodge paying taxes or child support.

3. Publicly Shame You

It is against the law for debt collectors to publicly embarrass you into paying money you might or might not owe. They aren't even permitted to send you a postcard, in fact. The names of those who owe money cannot be made public. They are not even permitted to speak about the situation with anyone other than you, your spouse, or your lawyer.

Debt collectors are authorized to make contact with other parties in an effort to locate you, but they are only allowed to request your address, home phone number, and place of employment from them. They often won't get in touch with such persons more than once.

4. Try to Collect Debt You Don’t Owe

Some debt collectors may intentionally or unintentionally depend on false information in an effort to defraud you of money. Your debt may have been transferred by the original creditor to a collection agency, which may have then sold it to another collection agency. The collector that contacts you may have the wrong information if there was an error along the route.

Alternatively, the collection agency may be attempting to recover a debt from you that has already been forgiven in bankruptcy or even by someone else with a name identical to yours. A debt collector must provide you a written notification outlining your debt, who you owe it to, and how to make payments within five days after their initial contact with you. They might need to be persuaded to do this.

Send a letter to the debt collector via certified mail and request more information if you are unsure about your debt status. Be careful not to take on any debt-related obligations. To avoid saying the wrong thing or disclosing more information than is necessary, you might use the Consumer Financial Protection Bureau's sample letters to debt collectors.

5. Harass You

The law lists specific ways in which debt collectors are not allowed to harass you. They are not permitted to:

?????????????Threaten you with violence or harm

?????????????Use obscene or profane language

?????????????Call you repeatedly

?????????????Call you before 8:00 a.m. or after 9:00 p.m. without your permission

?????????????Call you at work, if you forbid it in writing

?????????????Contact you at all if you tell the collector, in writing, to stop contacting you altogether or to contact only your attorney.

Even if you take that final step, there are still situations when debt collectors may still get in touch with you: They may get in touch with you to inform you that they will no longer be in touch with you or that a lawsuit has been brought against you. Don't disregard a court summons for a lawsuit involving your debt if you receive one. Such a document might be faked by an unscrupulous debt collectors or debt collection agencies, or it might be real.

If you receive a summons, make sure the notice is accurate by contacting the court immediately using the contact information available online (not on the notice you received). The address and phone number on the document you get should not be used.

One Big Exception to These Rules

There's an important exception to the FDCPA: It does not apply to internal debt collectors. For instance, Macy's is not required to abide by the guidelines outlined above if it calls you personally because you are past due on your credit card statement.

The majority of in-house debt collectors pursue accounts that are only a few weeks or months past due. After that, the original creditor usually sells your debt to a debt buyer who keeps the money it collects or employs a collection agency to pursue collection on its behalf.