How Credit Card and Other Debt Collectors Routinely Break the Law

Today's economy may have affected you in ways you never thought possible. Has a credit card debt collector ever threatened to take your home if you don't pay off what you owe his company? Has a collector ever told a family member, friend, or coworker about what you owe his company? Maybe you remember a time a debt collector woke you at six in the morning to complain about the money you owe his company. A credit card debt collector may have even told you have committed a crime by not paying your debts. If you have been harassed in any of those ways by a debt collector, the collector was breaking the law.

The Fair Debt Collection Practices Act forbids a debt collector from doing certain things. You have rights under the law. By law a debt collector may not: call you before 8 a.m. or after 9 p.m.; talk to anybody else about your debt, this includes family members, coworkers, your employer, or your friends; bluff taking your home; bluff garnishing your wages; bluff legal action; threaten to arrest you; threaten physical violence; use racially charged language; curse you; pretend to be a lawyer; or call your place of work, if you have told that debt collector not to do so.

You think credit card debt collectors are unfair? You're not alone. Experts say that is why Congress passed the law in the first place--partially because Congressmen believed abuses by debt collectors caused an increase in the filings of personal bankruptcies.

According to the website, http://www.expertlaw.com, the FDCPA applies to family, personal, and household debts. Those debts could be related to the purchase of a car, money owed on credit cards, debts related to medical care, retail financing, or first and second mortgages.

The law covers attorneys working for debt collectors as well as the debt collectors. While you may legitimately owe debts and are responsible for paying them, there are still things a debt collector can and cannot legally do to collect from you. The law does not cover a store's own collection department for a store credit card, but if that store uses an outside agency to collect from you, it is covered. Some states may have laws that regulate local collection agencies.

A credit card or other debt collector cannot falsely claim take action to hurt your credit rating, to repossess your car, garnish your wages, or threaten to take legal action, if he has no intention of doing so. He may warn you of impending legal action. Note that nobody can garnish your wages or take similar action with court action first. If a debt collector tells you otherwise he is lying and is breaking the law.

There are other things that cannot be done, according to the law. A debt collector cannot send you letters that seem to be from a court, if they are not actually from a court. A debt collector cannot seek collection fees or interest payments that are not permitted by law. A debt collector cannot ask for a post dated check and then threaten to prosecute you if it bounces. A debt collector cannot sue in a court that is a long way from your residence. A debt collector cannot make false claims to collect your money, including claims that he is taking a survey, is an attorney, that he has started a lawsuit, or using stationary that is falsely designed to look like it is on a court or other official government stationary. A debt collector cannot threaten to have you arrested if you do not pay him.

According to the website, http://www.columbia.edu, there are several things you should do if a debt collector harasses you or breaks the law.

Even if a debt collector is not breaking the law, under the law, you may send the creditor he is representing a letter asking the company to stop all communications with you. That company must by law not contact you except to say that legal proceedings have been implemented or that collection efforts have ended. Some experts have suggested, however, telling a debt collector about specific efforts you are making to pay (provide documentation) and that you will accept contact only every so often, for example once every two weeks, or once a month. If you receive more calls than that, hang up.

Document every time a debt collector breaks the law. Write down every detail about who called, the time, the name of the creditor, and what happened. Have a witness with you if possible. In some states you can even record your call without his knowledge, but check to see whether that is legal in your state. Even if it is illegal in your state to record without the creditor's knowledge, tell him you are recording the call. Ask someone from your state consumer protection agency about the laws in your state.

File a complaint with the Federal Trade Commission at http://www.ftc.gov/ftc/complaint.htm. In your complaint, include the name of your creditor, the name of who contacted you, the address of your creditor, the dates and times you were contacted, the names of witnesses, a recording of the incident, if you have one. After you file a complaint, send a copy of the complaint to the creditor, because he may either work more with you on helping to pay the debt according to terms you can afford or cancel it. Also, send a copy of the complaint to the state agency that regulates collection agencies in your state. To receive the name of that agency, call information at your state's capital city.

You also could sue the creditor in Small Claims Court, with you representing yourself, or hire a lawyer and sue in regular court. Take this action only if you have been subjected to repeated harassment. You may be allowed punitive damages or damages to punish a debt collector for outrageous conduct and any money you are out, for example what you paid to switch phone numbers.

We should all pay all of our debts. Everyone has made mistakes in life, including financial mistakes, however. In addition, today's economy has affected people in ways they may never have expected. For those reasons, you need to know your rights if debt collectors have harassed you repeatedly, especially if they have broken the law.

Citations: The Fair Debt Collection Practices Act (FDCPA), No author listed, Expertlaw.com
What to Do If a Bill Collector Crosses the Line, No author listed, Columbia.edu