Fair
Credit Collection Act:
Collection
Agencies, Debt Collectors, Credit Disputes and Your Rights!
If you use credit cards, owe money on a personal loan, or are paying
on a home mortgage, you are a "debtor." If you fall behind in repaying
your creditors, or an error is made on your accounts, you may be
contacted by a "debt collector." You should know in either situation,
the Fair Debt Collection Practices Act requires debt collectors
treat you fairly by prohibiting certain methods of debt collection.
Of course, the law does not forgive any legitimate debt you owe.
Below are answers to commonly asked questions about your rights
under the Fair Debt Collection Practices Act.
What debts
are covered?
Personal, family, and household debts are covered under the Act.
This includes money owed for the purchase of an automobile, for
medical care, or for charge accounts.
Who is a
debt collector or collection agency?
A debt collector is any person or agency, other than the creditor,
who regularly collects debts owed to others. Under a 1986 amendment
to the Fair Debt Collection Practices Act, this also includes attorneys
who collect debts on a regular basis.
How may
a debt collector contact you?
A collector or agency may contact you in person, by mail, telephone,
telegram, or FAX. However, a debt collector may not contact you
at unreasonable times or places, such as before 8 a.m. or after
9 p.m., unless you agree. A debt collector may not contact you at
work if the collector is aware that your employer disapproves.
Can you
stop a debt collector from contacting you?
You can stop a collector from contacting you by writing a letter
to the collection agency telling them to stop. Once the agency receives
your letter, they may not contact you again except to say there
will be no further contact. The agency may notify you if the debt
collector or the creditor intends to take some specific action.
May a debt
collector contact anyone else about your debt?
If you have an attorney, the debt collector may not contact anyone
other than your attorney. If you do not have an attorney, a collector
may contact other people, but only to find out where you live and
work. Collectors usually are prohibited from contacting such permissible
third parties more than once. In most cases, the collector may not
tell anyone other than you and your attorney that you owe money.
What must
the debt collector tell you about the debt?
Within five days after you are first contacted, the collector must
send you a written notice telling you the amount of money you owe;
the name of the creditor to whom you owe the money; and what action
to take if you believe you do not owe the money.
May a debt
collector continue to contact you if you believe you do not owe
money?
A collector may not contact you if, within 30 days after you are
first contacted, you send the collection agency a letter stating
you do not owe money. However, a collector can renew collection
activities if you are sent proof of the debt, such as a copy of
a bill for the amount owed.
What types
of debt collection practices are prohibited?
Harassment. Debt collectors may not harass, oppress, or abuse
anyone. For example, debt collectors may not:
- Use threats
of violence or harm against the person, property, or reputation;
- Publish a
list of consumers who refuse to pay their debts (except to a credit
bureau);
- Use obscene
or profane language;
- Repeatedly
use the telephone to annoy someone;
- Telephone
people without identifying themselves;
- Advertise
your debt.
False statements.
Debt collectors may not use any false statements when collecting
a debt. For example, debt collectors may not:
- Falsely imply
that they are attorneys or government representatives;
- Falsely imply
that you have committed a crime;
- Falsely represent
that they operate or work for a credit bureau;
- Misrepresent
the amount of your debt;
- Misrepresent
the involvement of an attorney in collecting a debt;
- Indicate
that papers being sent to you are legal forms when they are not;
- Indicate
that papers being sent to you are not legal forms when they are.
Debt collectors
may not state that:
- You will
be arrested if you do not pay your debt;
- They will
seize, garnish, attach, or sell your property or wages, unless
the collection agency or creditor intends to do so, and it is
legal to do so;
- Actions,
such as a lawsuit, will be taken against you, which legally may
not be taken, or which they do not intend to take
Debt collectors
may not:
- Give false
credit information about you to anyone;
- Send you
anything that looks like an official document from a court or
government agency when it is not;
- Use a false
name.
Unfair practices.
Debt collectors may not engage in unfair practices when they try
to collect a debt. For example, collectors may not:
- Collect any
amount greater than your debt, unless allowed by law;
- Deposit a
post-dated check prematurely;
- Make you
accept collect calls or pay for telegrams;
- Take or threaten
to take your property unless this can be done legally;
- Contact you
by postcard.
What control
do you have over payment of debts? If you owe more than one
debt, any payment you make must be applied to the debt you indicate.
A debt collector may not apply a payment to any debt you believe
you do not owe.
What can
you do if you believe a debt collector violated the law? You
have the right to sue a collector in a state or federal court within
one year from the date you believe the law was violated. If you
win, you may recover money for the damages you suffered. Court costs
and attorneys fees also can be recovered. A group of people also
may sue a debt collector and recover money for damages up to $500,000,
or one percent of the collectors net worth, whichever is less.
