•           Get in touch via postcard

•           Give a name that’s fake

•           Provide fake contact information

•           Say your debt is more than it is (except if the collector was given incorrect information by the creditor)

•           Say they are employed by a credit reporting agency

•           Say you have committed a crime

•           Say you will be sued if they have no intention of doing so or don’t anticipate the creditor to sue you

•           Say they are an attorney if they aren’t

•           Say they act for an attorney if they don’t

•           Send you a document that looks the same as an authorized court document if it’s not

•           Send and tell you papers are not legal form if they are

•           Provide others with information about you that’s fictitious

•           Notify or make threats to notify anyone about your debt

•           Say you’ll be placed under arrest if you don’t pay

•           Make threats to your family members, colleagues or friends (15 U.S.C. 1692d)

•           Threaten to or print your name as a person who won’t pay debts other than a Credit Reporting Agency (15 U.S.C. 1692d)

•           Make use of Obscene language is not allowed (15 U.S.C. 1692d)

•           Contact you if you request them not in writing or inform them you retain an attorney

•           May not take a higher amount than what you owe (certain states permit an extra charge for collectors)

•           May not pay in a post dated check ahead of time

•           Make threats to seize your property if the creditor or collector can do it lawfully

What action do you take if you suspect a collector has contravened the law?

You must give an account of any problems you experience to The Federal Trade Commission.  This is the official group taking care of consumers to stop fraudulent, deceptive and abusive practices in business.  The consumer can visit http://ftc.gov or phone 1-877-FTC-HELP for assistance.  (15 U.S.C. 16921)

Complain to the office of the Attorney General in your state.  You can use online forms for complaints.  These are for any grievance against creditors and collectors you suspect of having contravened Federal Fair Debt Collection Practices Act and Debt Collection and Creditor Collection Laws of your state.

Collectors can be sued in a Federal or State Court and it is your right to do so.  You must do it within a year of the date the law was contravened.  If you are successful in suing, the collector may have to get back compensation (15 U.S.C. 1692i).  You may use an attorney.  If you can’t afford an attorney, or need to find one, get hold of the Legal Services Provider.  Or you can ask the state Lawyer Referral Service or the country or regional Bar Association closest to you.

Each state has a different protection for its consumers.  If a law doesn’t go against any section of the Federal Act it is not possible to amend the laws of any State Debt Collection Practice.  State Law takes preference over The Federal Act if there is a conflict between the two.  This is applied if State Law gives you greater protection than the Act.  (15 U.S.C. 1692a, n)  An attorney is qualified to counsel you on your rights.

Disclaimer:

All the information including legal is given only for educational and information purposes.  This site is to assist consumers in finding out about their rights.  You must be aware ‘legal information’ is different from ‘legal advice’.  All the opinions, links, instructions, content, suggestions and advice are made use of at your own risk.  It is important that you get counsel from an attorney before coming to any conclusions that have financial or legal results.  As this site is not intended for the rendering of financial or legal counsel do not use it instead of financial and legal experts.

Every effort has been made to guarantee the information carried by this site is correct we are not liable for any mistakes or oversights, or for the outcome due to the use of information on this site or any site we have supplied links to as a consideration to you.

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If you suspect the amount is wrong you must state in a letter you don’t owe the money being requested by the collector.  Send the letter within 30 days of the day you got your written notification of the money owed.  Send the letter to the collector.  (15 U.S.C. 1692g(b)).

It may be annoying if the collector will not accept payments that are partial.  This is especially so if you and the creditor have agreed to this arrangement.  It is legal for the collector to ask for bigger installments in a shorter period.  This may annoy you but it is legal.  It is illegal for the collector to make false statements or use misleading methods to collect money you owe.  But the collector may negotiate its own conditions without using illegal ways.  If you propose a part payment because you are aware the creditor will accept the collector may not imply only a full payment is good enough.  (15 U.S.C. 1692e)

On the whole collectors are not allowed to add interest, fees, expenses or any charges to the original money owed.  It is permissible for a collector to charge extra when:

An agreement between you and the creditor incorporated expenses and fees; or

The state where the contract was drawn up allows it;

The state where a judgment was entered into allows it

(15 U.S.C. 1692f)

What to do if multiple debts are owed?

A collector must follow your instructions if you have more than one debt.  A collector must use the money from you to pay the debt you instruct him to pay.  A collector may not use the money to pay any other debt.  (15 U.S.C. 1692h)

What takes place in the 30 day dispute period?

This is not a period of grace.  The collector can attempt to collect money you owe until you challenge any or the complete debt.  You must put this in writing and it must be within 30 days of you getting the debt notification.  Take note it is from the day you receive the notice and not the date on the letter or the postmark).

You should challenge the debt as soon as you can.  You can be sent a summons to appear in court at the same time a collector informs a Consumer Reporting Agency of your debt.  You must go to court if you get a summons to appear following your debt dispute in writing.  Be sure to take a copy of your dispute letter to the collector and let the judge know the collector did not give you proof of the money you owe.

What a collector may and may not say to you:

Collectors must let you know who they are, who they are collecting money for and the amount of money you owe.  (15 U.S.C. 1692d-f)

Click here to see Part 4: Do You Know Your Debt Collection Rights? Part 4

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If you have an attorney handling your debt the collector is allowed to contact your attorney.  (15 U.S.C. 1692b(6)

How do you prevent a collector from communicating with you?

You have to tell the collector to stop contacting you in writing.  You must keep a copy of the letter.  When the collector gets the letter he is not allowed to get in touch with you regarding the debt again.  The collector may only inform of what action the creditor will take to determine the debt. A creditor can sue you to get the money you owe.  (15 U.S.C. 1692c and 1692i)

It is important to understand your letter to the collector will not get rid of the debt.  It only stops the collector from getting in touch with you.

How does an attorney help you?

You must let the collector know you have an attorney.  Give your attorney’s name.  You can ask your attorney to take care of the situation.  Let the collector know this is the situation and you don’t want to be contacted again.  The collector will only be able to get in touch with you with the permission of your attorney.  If your attorney does not react to your collector within a certain time frame the collector can contact you.  (15 U.S.C. 1692b(6)

What is a collector obliged to tell you regarding your debt?

Following the first time a collector has contact with you he has 5 days to do the following:

Inform you in writing you owe the creditor money;

Inform you of your right to dispute the debt.

The written information must contain:

Debt amount

Creditor’s name

Your right to dispute, the whole or part of, the money owed, in writing, within 30 days of you getting the notification.

The time period for the 30 days begins on the day you get your notification.  You must take note of the letter’s date or the postmark.

(15 U.S.C. 1692g)

If a consumer is incorrect or mistakenly identified this is the act to help.  This is why you must get a confirmation of the name of the consumer and the amount owed as it was acquired from the creditor.  You must get this in writing.

What if you suspect you are not in debt to the creditor?

If you suspect you don’t owe money to the creditor send a letter informing the collector of such.  This must be done within 30 days of the day you got written notice of the money owed. (15 U.S.C. 1692g(b))

You can let the collector know not to get in touch with you until you get proof of the money owed.  You must do this in writing.

As soon as you challenge the debt in writing the collector may not collect cash from you.  They must wait for you to get written proof of the money owed.  A document with your name, creditor’s name and amount owed in writing is sufficient as proof.

You must understand your dispute in writing will not get rid of the money owed.  The thirty days is so the creditor can provide proof you do owe money.  It is not a period of grace.

Getting together proof of debt can take time.  A collector is not limited to any time period to give you proof.  A collector may not be able to give you proof.  Another company can take over your debt and attempt to collect the money from you.  Go through each step again until you are shown actual proof of money owed by you.

Click here to see Part 3: Do You Know Your Debt Collection Rights? Part 3

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Don’t despair because there are actions you can take to control debt collectors.  There is a Fair Debt Collection Practices Act to uphold the rights of consumers.  Unfair debt collection methods are prohibited by law.  If you want to protect yourself you have to know how.

The information of 15 U.S.C. 1692 – 1692o was last revised on 2 June 2005.  We are under no obligation to update the information given.

This page has the following definitions:

A consumer is an individual who makes use of a credit card or owes money.  A consumer can also be your spouse, parent, if you are underage, guardian, executor or administrator (15 U.S.C. 1692c(d).

You owe debt (money) to a creditor this is for anything you owe for personal purposes.  This does NOT include business or commercial purposes (15 U.S.C. 1692a(5); 1692c(d)).

A collector is the person who makes contact with you if you are behind with your payments to your creditor. The collector can be an attorney, individual or a company.  This company is paid by your creditor to collect overdue payments.  Debts owed to someone else are collected by a third party collector (on behalf of the creditor).  (15 U.S.C. 1692a(6)).

Do collectors have the right to contact you and when can collectors contact you?

The answer is yes.  Collectors can make contact with you in person, phone, fax, mail or telegram.  They are banned from contacting you prior to 8 am or later than 9 pm.  Times and places considered as out of the ordinary are unlawful.  Collectors may contact you at any time if you give them permission to do so.

A collector would usually not contact you if you inform him you have an attorney handling your debt(s).

It is sensible to keep a record the interaction between you and the collector.  Make sure you have the collector’s name, date of contact and details of discussion.

Can family, friends or a place of work be contacted by collectors?

It is unlawful for a collector to contact or talk about your debt with anyone other than you.  A collector has the right to get in touch with other people to ask where you live, work and your phone number.  But this may only happen one time.  (15 U.S.C. 1692c(b)).

It is unlawful for a collector to:

Get in touch with a person more than one time (a collector must have your permission to make contact more than one time).  A collector may not inform the person contacted it is debt collection.  A collector may not provide any document or postcard that gives information or symbols on the envelope indicating the purpose of the mail is for the purpose of collecting a debt.

Your employer may be contacted by a collector one time.  A collector may send a letter to your employer requesting confirmation of employment.  A collector may not request personal information about you from your colleagues or employer.  Should a collector contact your place of employment more than one time for the same reason you can tell him your boss is not in favor of you getting this kind of call at work.  (15 U.S.C. 1692b-c)

A collector can be told by your family and friends not to call again if he has already phoned one time.  The collector may not make more than call without the permission of your family and friends.  (15 U.S.C. 1692b-c)

Click here to see Part 2: Do You Know Your Debt Collection Rights? Part 2

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1.  What is the credit card debt of the US?

$972,494,000,000 made up the debt that was revolving in the US.  Credit card debts from finance companies, securitized debt balances, credit unions and commercial banks were all incorporated when calculating this figure. (Source: Federal Reserve)

2.  How do debt balances in the US alter from year-to-year?

There was a rise in the balances of credit card debt by 75%.  This took place in America from 1997 – 2007.

2007 – $972 billion (7.7 % increase)

2006 – $902 billion (6.2 % increase)

2005 – $849 billion (3% increase)

2004 – $823 billion (4% increase)

2003 – $791 billion (2.8% increase)

2002 – $769 billion (4.4 % increase)

2001 – $736 billion (4.8 % increase)

2000 – $702 billion (12 % increase)

1999 – $627 billion (5 % increase)

1998 – $597 billion (7.5 % increase)

1997 – $555 billion

In prior decades there were also important increases:

1987 – $169 billion

1997 – $39 billion

1967 – $1.4 billion

(Source: Federal Reserve)

3.  What is the amount of credit card debt held by the average American?

The balances of credit card debts are as extensive as installment borrowing.  There is less credit card debt held by highest and lowest earning categories, wealthiest category and families with a head of household sixty five years or older.  There was an increase in the number of families with debt from 2001 to 2004.  This balance increased from 1.8 points of percentage to 46.2 percent.  Prior to this the increase was much less.  This rise was seen in all population groups.  The numbers with debt decreased in the following groups:  two lowest earning, lowest wealth, youngest, nonwhite or Hispanic families and renters.

The general median balance for debtors went up 10.0 percent to $2,200.  15.9 percent to $5,100 was the mean increase.  There was hardly any change to the median for the next three years.  However, it had gone down by 8.3 percent.  Of late, most population groups experienced a noticeable rise in median balance.  Borrowing went down in the following groups:  youngest, lowest earning and next to highest earning.

A large number of families don’t have balances even thought they have credit cards.  In 2004, 58.0 percent did have a balance.  This was forty one out of 74.9 percent.  In 2001, 76.2 percent had cards but only 55.4 percent had balances that were outstanding.

4.  How much of the average American’s earnings are in credit card debt?

The average American household earns approximately $43,200 in median terms.  This means the level of debt from credit cards is from 5 to 12 percent of yearly earnings.  (Source:  Federal Reserve)

5.  How much are credit cards costing American consumers in debt?

A consumer who has a balance of $5,000 and an APR of 16% and who pays $125 per month requires 4.8 years and $2,000 in interest to repay the balance.

If the APR went up to 25% and the balance stayed the same a consumer would require 7 years and $5,800 in interest to pay back the debt.

If the APR came down to 9% and the balance stayed the same a consumer would require 4 years and $966 in interest to pay back the debt.

These are the facts and figures to urge you to pay off your debt.

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