Collection Agencies
What You Need to Know Before You Answer the Phone
Before we dig too much further into your credit reports, it’s time to address collection agencies. If you’re in need of credit repair, you’re probably all too familiar with the letters and phone calls from these guys.
Normally when you get calls from creditors, what do you do? Do you check the caller ID and ignore it? Do you answer the phone and prepare for intimidation? Or do you know your rights and speak with confidence?
If you’re like most people, you choose the first two options. However, you do have rights when it comes to collection agencies.
The Cans and Can'ts of Collection Agencies
...many collection agencies do some or all of these things. Why? Because few consumers know that they have rights or how to defend them.
Instead of allowing a collector to strike fear in your heart, it’s better to be informed of how collectors operate and what your rights are when dealing with them. Many people feel threatened by these entities, but there’s no reason to feel that way.
Many bill collectors work in such a way that you feel harassed. Fortunately, harassment by collection agencies is illegal in the United States. A law called the Fair Debt Collection Practices Act outlaws the use of harassment as a method for collecting on a bill.
There are several practices that are specifically laid out by this law and are illegal. If you have a collection agency using any of these tactics against you, you have the power to stop it.
- Collectors are not allowed to contact anyone other than you to collect a debt while pretending to be a government official. If they do contact anyone to find out your location, they must identify themselves and if asked, he or she must tell the person whom they work for. He or she must not tell the person they speak with that you owe a debt.
- They can’t ask you to pay using post-dated checks that are dated for more than five days later – which cause you to break the law. If they do get a post-dated check that’s more than five days later they must notify you in writing that they’ll be depositing it.
- Collection agencies love to ask for post-dated checks because they can use them against you later. They hope that your check will bounce and then they’ll be able to use the threat of legal prosecution and arrest to get you to pay them.
- Collectors are prohibited from sending “official” documents that threaten court actions if they aren’t actually official. This means they can’t send you any papers that look like official court or government documents to scare you into sending them some money.If a collection agency lies to you in any way, they’re breaking the law. They must be completely truthful about the amount you owe.
- They also aren’t allowed to threaten legal action such as arrest or seizing of property because they can’t do these things. Unless you’ve given property as collateral for a loan, a credit collection agency can’t threaten to seize it from you.
- Collection agencies can’t use any type of obscene language, violence or the threat of violence, publish your name, or threaten to sell your debt to another party.
- If you have a collection agent calling you, he or she can’t use harassment by making repeated phone calls, anonymous calls, or hanging up on you.
The thing that you need to know, though, is that many collection agencies do some or all of these things. Why? Because few consumers know that they have rights or how to defend them.