Dealing with Debt Collectors
Keep Emotions in Check when Dealing with Debt Collectors
Do you panic when you hear that cold voice on the telephone informing you that “This call is being recorded?” Dealing with debt collectors has begun and it is not just going away soon. The process of trying to get you to pay up on something can turn unpeasant in a hurry. Is the alleged debt something you really owe but just need more time for? Most of the time the collectors are at least somewhat reasonable in the beginning. When dealing with debt collectors remember they work on commission. Their idea of a reasonable period of time to make payments is going to be a lot different than yours. Dealing with debt collectors aggressively will keep the reins in your hands. Insist that they prove their right to collect the debt. Make them produce their contract with the original creditor. If they can’t do this you will eventually win a deletion from your credit reports. File detailed objections and appeal to the CFPB when necessary.
A little known trick I have used successfully in tough cases is to check with the Secretary of State and Department of Business regulation in your State to see if the debt collector’s license to collect is current. If it’s not they have no legal standing to collect the debt. The debt must be expunged. You will be surprised to find that many debt collecting companies are careless in this regard.
The Fair Debt Collection Practices Act (FDCPA) is the law that covers what is and is not allowed to further the collection of debts. It applies to those who collect debts owed to creditors for personal, family and household debts. These debts include car loans, mortgages, charge accounts, utilities, medical bills and more. A debt collector is someone who is hired to collect money you allegedly owe. This law does not apply to the original creditor.
Within 5 days after a debt collector first contacts you, the collector must send you a notice that tells you the name of the creditor, how much you owe, and what action to take if you believe you don’t owe the money. If you owe the money or part of it, contact the creditor to arrange for payment. If you believe you don’t owe the money, contact the creditor in writing and send a copy of the letter to the collection agency with a letter telling it not to contact you. The debt collector must stop calling if you demand it in writing. A debt collector may not:
1. Contact you at unreasonable times, for example, before 8am or after 9pm, unless you agree.
2. Contact you at work if you tell the debt collector your employer disapproves.
3. Contact you after you write a letter telling the collector to stop, except to notify you if the collector or the creditor plans to take a specific action.
4. Contact your friends, relatives, employer, or others, except to find out where you live or work.
5. Harass you with repeated telephone calls, profane language or threats to harm you.
6. Make any false statement or claim that you will be arrested.
7. Threaten to have money deducted from your paycheck or to sue you, unless the collection agency or creditor intends to do so and it is legal.
To file a complaint contact your state or local consumer protection agency and the Federal Trade Commission. The FTC’s Consumer Finance Protection Bureau (CFPB) can be reached at www.consumerfinance.gov/complaint. You can also call toll free (855) 411-2372. Mail goes to CFPB, PO Box 4501, Iowa City, Iowa 52244. The CFPB web site has links to form letters you can use to make collectors verify and document their evidence.
FTC levies $3.2 Million dollar fine against Expert Global Solutions
Expert Global Solutions is the largest debt collection agency in the world according to the FTC. That said, I’m sure the rest of the debt collection industry has been scared straight by the record $3.2 Million dollar fine levied against them by the FTC. It seems the debt collectors had developed the bad habit of calling consumers at their homes or places of employment multiple times a day even after being asked to stop or being told that the employer prohibited such calls. Under settlement terms the agency must react to consumer disputes by either closing its file and ending collection activities or conduct an investigation to verify the accuracy of the underlying information. This is not always easy since many debts are resold multiple times without the documentation following along. Dealing with debt collectors is getting a whole lot easier with this new government muscle backing consumers up.
Follow Up Debt Collector’s Promise to Delete with Challenge
It is always a victory of sorts to get the debt collector to agree to delete and purge all reference to the debt on your credit reports after you pay. Get this promise in writing in the form of an email. Don’t wait for them to make good on their promise. Send a letter to the credit reporting agency that carries the negative entry. Since the debt collector has been paid they won’t respond to your letter and the reference will be gone in 30 days. Remember their call and conversation with you was recorded. This can be used for you to back up your insistence that all references be purged from your report.