You have been on a high pulse rate for the last few days because of the continuous calls by the debt collectors asking you to pay the bills you are falling short on. Debt collectors can be a first-party agency, a department or a subsidiary of the original company debt is owed to, or a third-party agency, a separate company contracted by the creditor to collect debts on their behalf for a fee.
Their job is to engage you in a debt-paying discussion where they will force you in many ways to pay the debt you owe to your creditor. Many cases of misconduct by these agencies during this whole debt collection process have been registered, and they are normally with the third-party collection agencies that are subject to Fair Debt Collection Practices Act of 1977, administered by Fair Trade Commission (FTC), and Consumer Financial Protection Bureau (CFPB).
Being a part of the original creditors, first-party agencies are on relief as they are not subject to that legislation.
Reasons why people fall under this debt-trap are: over commitment on debtors part, debt due to an unforeseen eventuality such as the loss of a job or health problems, dispute or disagreement over the debt, or dishonesty on the part of either the creditor or the debtor, etc.
A third-party debt collecting agency’s profit is the percentage share of the debt collected by it. This can encourage them to resort to some misconducts that can harass you mentally in the process.
However, thanks to the legislation that enables you to restrict such practices and save yourself from falling into such traps.
This is a mind game. You need to play it patiently, politely, and most of all, smartly. When a debt-collector calls you:
• Be Polite and Listen Carefully: The very first thing you’ll be doing is to remain polite and be present with all your ears. Keep in mind that the debt collector is just doing his job. If you get angry or emotional, it may end up counting against you later when you decide to file a harassment case against the debt collector.
• Speak as Little as Possible: As I said earlier, this is a mind game and the debt collector who calls you is trying to determine if you have the ability to pay. Under his/her influence, you may say something that can be misinterpreted such as acknowledging the debt as this will give him/her the upper hand in the beginning itself to further pursue you to pay the debt. So, stick to the facts, demand everything in writing, and stand firm.
• Ask Him to Stop Calling: If you want them to stop calling you, ask them for it by sending a letter using certified mail. Under the FDCPA guidelines, they have to stop calling you if you tell them to. However, you can do this only when you’ve confirmed that the debt is not yours. If you know the debt is yours, you will need to keep in touch with them to negotiate a settlement.
• Make the Debt-Collector Identify Himself: Ask the name of the person who calls you, the company he/she works for, and the address where it’s located. Also, ask him to deliver any information about your debt in written. This way it will become easier for you to know about the debt collector and also about what you owe to them.
• Verify Your Debt Before Anything: Before paying or acknowledging the debt, be certain that the debt is yours. You must ask for a written account of what the debt collector claims you owe, and also about the company with which you originally opened your account, and the dates the account was opened and closed. Given by FDCPA, the debt collectors will have to send you the verification of the debt in written, and till you get them, they can’t engage in collection activities.
• Check Your Credit Report: If you have no clue about the debt, you may have fallen victim to the tax identity theft. In that case, check your credit report by requesting it from annualcreditreport.com and when you get it, scan it for any incorrect data.
If any discrepancy is found, notify each of the three credit reporting bureaus and also the debt collector. Send a written note to the debt collecting agency within 30 days of receiving debt collector’s notice on debt. If found legitimate, the debt collector may voluntarily stop any collection activity against you.
• Make Copies of the Letters and Keep a Recording of Calls and Messages: Keep a copy of the letters you wrote and signed for the credit reporting bureaus and for the debt collector. Also, ask for a return receipt by the collectors to keep them as a proof that your letter was received by the agency on time.
Also, keep a record of every letter or notice, and calls from the debt collection agency right from the beginning. This will help you in getting an edge over the agency if they try to sue you or drag you into court. Don’t delete any voice messages and also write a summary of whatever you talked to them on phone including the date and time of the call.
There are certain guidelines that restrict the debt collectors from any type of misconduct on the phone or in anyway: they can’t call you at work, or before 8 a.m. and after 9 p.m., unless you agree, can’t use abusive or obscene language; can’t threat you to sue unless they plan to take a legal action, can’t claim falsely to be an attorney or a law enforcement official, and many more.
You’ll have to know all these guidelines to avoid any such misconduct from the side of the debt collector. Also, in the event of occurrence of any of these cases, file a complaint with the Federal Trade Commission or the Consumer Financial Protection Bureau. The CPFB will review your complaint, and then forward it to the companies and work to get a response or explanation from them.
If the debt is yours, and you have to pay it, try to negotiate with the debt collector and offer them an amount that you can really pay.
• Bargaining will Help a Lot: Bargain with them, try to bring them down to the lowest possible amount. Just keep one thing in mind, the debt collection agency probably bought the debt from the original lender for a fraction of what you owed. Collection efforts cost the company time and money, so debt collecting agency may agree to accept lesser amount if you pay them sooner.
• Don’t Commit To Pay What You Can’t Afford: Refrain from committing to pay anything for which you may have to take another debt. Debt collectors will be in a hurry that you pay them as much as possible and as soon as possible. You shouldn’t agree to pay such plans as they may put you in jeopardy of not being able to pay your other bills such as electricity or rent.
Debt collectors can’t resort to illegitimate ways of harassing you or threatening you unless they opt for a legal action. Just because you’re in debt doesn’t give any right to them to harass you or take any wrong advantage of you.
It has to be solved through negotiation, and if you are unable to negotiate with the collection agency, contact a debt relief attorney at Keating & Lyden to find out how you can put your financial troubles behind you.