Stop Bill Collectors

Know Your Rights

In order to repair your credit the first thing you need to do is to stop the bill collectors and give yourself a little breathing room. In this section you are going to learn how to stop the bill collectors in their tracks and how to assert your rights against unfair collection practices. There are two pieces of legislation (ACTS) that outline how collectors and credit reporting repositories can contact and report information about you.

The first piece of legislation that we will be referring to in this chapter is the Fair Debt Collection Practices Act . I suggest thst you save this document or click this link and bookmark it now. This is your first line defense against debt collectors. Debt collectors regularly push the limits, or outright ignore, the protections afforded you by this ACT. If you know your rights, and they know that you know your rights, it puts you on a level playing field.

The other act pertains to how collection agencies and the credit bureaus can report information about you on your credit bureau. This has more to do with the legality of things that CAN be reported about you. For example, how long items can stay on your bureau; when items can or cannot be reported to the bureau. This little jewel is called the Fair Credit Reporting Act (FCRA). This act gives you specific rights to how collectors MUST report collection items on your credit report, and how credit repositories must display these items. It is a little legalistic, but you should have a copy of it for reference.

Stopping Bill Collectors

1. You have the right NOT to be harassed at home and at work

This can be found in the FDCPA, section- 805. Communication in connection with debt collection. The collectors are not allowed to:

Call you at any unusual time or place.(late at night early in the morning)
Contact you in any way if you have obtained an attorney.
Call you at work, if the employer prohibits or frowns on personal phone calls.
Speak with relatives or friends concerning your debt, UNLESS it is being done in an attempt to locate you.
Cannot contact you after you have sent a Letter of Validation until they have validated the debt.

If you are having trouble with debt collectors who ignore, or push the boundaries of these rights, you may need to assert your rights. To assert these writes you need to send the collector a CERTIFIED letter with a RETURN RECEIPT, asking the collector to immediately stop these activities. If the collector doesn’t, and you can prove it, you can alert the FTC, (Federal Trade Commission) and report them. In rare cases you can sue the collectors, however, the FTC hits them with $10,000 fines for violating the Fair Debt Collection Practices Act.

2. Debt Collectors MUST validate any debt they are attempting to collect

Validation of debts, found in section 809 of the Fair Debt Collection Practices Act. Validation of debts of the FCPD. Collection agencies must notify you, in writing, within five days after the initial communication with a consumer in connection with the collection of any debt. Basically, “communication” can be established by speaking to the collector on the phone or by signing for certified mail. Once the collector has established communication, YOU have thirty days to dispute the debt. This is extremely important. Do not establish communication with a collector until you are ready to deal with the debt. (This is why you hang up on collectors immediately until you are ready to talk to them on your terms and NEVER sign for a certified letter from a collector)

Once communication is established, the collector must provide you with this information within 5 days (and rest assured they will):

the amount of the debt;
the name of the creditor to whom the debt is owed;
a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;
a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and
a statement that, upon the consumer’s written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.

Once they send you this information, YOU have thirty days to dispute the debt. This is huge! You lose a lot of your rights if you fail to dispute the debt within thirty days. This is why when collectors call they sound like a broken record asking: “is this John Doe” “Are you John Doe”.

They are trying to “establish communication”. If you acknowledge that you are the person they are asking for you have effectively established communication for them and started the clock on your ability to dispute the debt. Some sneaky collectors will open the phone call with “hey John how’s it going” in an attempt to get you to unknowingly establish communication for them. NEVER confirm your identity until you are ready to dispute the debt in writing.

Important! When collectors call, do not lie by saying “he doesn’t live here” or “you have the wrong number” or something like that. They can use that as proof that you were trying to hide from them, which opens up other options for them to track you down. Simply answer their question with a question. Example

Collector – “Is this John Doe”
You – “Who is this”
Collector – “Is this John Doe”
You – “What is YOUR name?”
Collector – “My name is Jane, Is this John Doe?”
You - “Why are you calling?”
Collector – “Is this John Doe”
You – “Why are you calling this number”

You get the picture. The trick is to NEVER deny you are the person they are looking for, but never confirm it either.

So to re-cap. If the collector is unable to establish communication with you, they cannot send you the debt validation information. This means that you have an indefinite amount of time to dispute the debt as long as they are unable to establish communication with you. However, once the collector establishes communication, the clock starts ticking on your window to dispute the debt.