Most creditors start debt collection efforts with a series of form letters, then they move onto phone calls, and then either a repossession occurs or the debt is referred to a collection agency or an attorney for suit.
Most parties that collect debt on behalf of an original creditor are restricted by the Fair Debt Collection Act.
According to the Act these are some of the restrictions on debt collectors:
-A debt collector cannot communicate with a consumer at the place of employment, if he has reason to know that the employer prohibits such communication.
-A debt collector cannot contact other people, except for closely regulated efforts to locate a consumer, (but then may still not state that the consumer owes money).
-A debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with collection of a debt.
-A debt collector cannot use or threaten to use violence on a person, reputation, or property of the person.
-A debt collector cannot use obscene or profane language.
-If a consumer notifies the debt collector that the consumer refuses to pay a debt, or that the consumer wishes the debt collector to cease further communication with him, then it is illegal to communicate with the consumer.
-A debt collector cannot cause the phone to ring repeatedly, or engaging any person in a telephone conversation, with the intent to annoy, abuse, or harass any person at the called number.
-A debt collector must disclose his identity, if requested.
-A debt collector may not falsely represent the character, amount or legal status of any debt.
-A debt collector may not imply that nonpayment will result in arrest, garnishment, seizure of property if such action is unlawful or unintended. In other words, a debtor collector cannot threaten to take any action that cannot be legally taken or that is not intended to be taken.
-A debt collector cannot falsely represent or imply that the consumer committed any crime or other conduct in order to disgrace the consumer.
-A debt collector may not threaten to communicate false credit information.
-A debt collector must disclose that a communication is to collect a debt, and that the information received will be used for debt collection, and that it is a debt collector.
-A debt collector may not contact you at unreasonable hours, before 8:00 a.m. and after 9:00 p.m.
I find that a lot of debt collectors violate the Fair Debt Collection Act. This is mostly because consumers are unaware of their legal rights under the law, or don’t have the proof to report the violation. So then the question is how should I deal with debt collectors?
Don’t let them pressure you into making the wrong choices about what to pay first. Constant harassment can cause consumers to pay the wrong debts first, resulting in serious consequences for the family.
To stop a debt collector from harassing you, simply tell the debt collector not to contact you anymore, under the “Fair Debt Collection Act” (use these words, he is aware of this law). By law, the debt collector cannot contact you without violating federal law. It is even better to tell the debt collector to cease communication in writing. The debt collector will usually get upset, so just hang up on him without further communication.
What can a debt collector really do to you?
A debt collector can do little more than demand payment. If the debt is unsecured, the creditor can only do three things:
Stop doing business with you.
Report your default to a credit bureau
Sue you in court.
It is important to note that many creditors do not follow through on their threats. After a period of time, the creditor can obtain a judgment, but this judgment still does not force you to pay the debt. It gives the creditor the right to seize part of your wages or particular property or assets that are paid for and that are not exempt. A creditor cannot garnish social security benefits, but can garnish a maximum of 25% of your take home pay from your wages, in Utah. Bankruptcy is a great tool to stop debt collectors.