Know Your Rights Against Debt Collectors

Forbes Magazine recently published a good article entitled "How to Hold off Debt Collectors." This article is very helpful for consumers. The article includes a section entitled "Six Consumer Rights Every Debtor Should Know." Here is a summary of the article.

The Federal Trade Commission (FTC) receives number of complaints every day about the violations of rules and regulations by third party debt collectors. In fact, the FTC gets more complaints about debt collection abuses than about any other specialized industry. Many debt collectors cross the lines and get vicious and controversial, making the recipients feel their rights have been grossly violated.

There are both state and federal laws which must be followed by debt collectors in compliance with the Fair Debt Collection Practices Act (FDCPA) and, for California consumers, the Rosenthal Fair Debt Collection Practices Act. These laws prohibit collectors, including both third party debt collectors and the original creditors, from practices that are fraudulent, unfair or abusive. However this doesn't seem to stop many collection agencies as many are rewarded on how much money they are able to collect from debtors. This leads many of them to tactics that are threatening and harassing and in some cases illegal.

[Note that the California Rosenthal Act protects consumers against unfair, abusive or fraudulent tactics by original creditors. The federal FDCPA applies only to third-party debt collectors, namely, companies or persons collecting on the debts of others.]

If you are facing such issues with debt collectors, you must know your rights under these laws and arm yourself, because, I promise you, it will be a battle.

Here are six consumer rights that a debtor must know as recommended by the Forbes Magazine Article:

1. The right to privacy

Collectors aren't permitted to call people you know such as your parents, friends and colleague to discuss your debt or get you to pay.

2. The right to be called at a suitable time

These laws permit debt collectors to contact you between 8 a.m. and 9 p.m., in your local time. If you are working and don't want the debt collector to call you during work hours and would want them to contact you at another time, tell them as they are required to comply with this request.

3. The right to a civil conversation

Debt collector aren't permitted to threaten you physically, or threaten your property or reputation, or use profanity. Continuous calling isn't permitted either. If this is happening write to the debt collector and inform that you are well aware of your rights and you want them to stop.

4. The right to an honest introduction

A debt collector is required to identify himself or herself as such and cannot misguide you by representing that they are a lawyer or law enforcement personnel.

5. The right to truthful information about your debt

A debt collector cannot overstate your debt and also cannot threaten you with jail or wage garnishment unless that is true or probable. Also, a debt collector may not add unauthorized fees and interest to your debt. The original contract with the creditor defines what the debt collector may or may not add to the debt in the collection process.

6. The right to dispute the debt

The debt collector needs to clearly state what you owe, and if you inform the collector in writing that you will not pay, they are required to stop trying to collect from you. Once you have informed them that you will not pay the debt, their remedy is to either file a case and collect through court or drop the case entirely.