In order to deal with debt collectors, it pays to learn what they can and can't do. Although most bill collectors are careful to follow the law when contacting you, some are not. If a bill collector goes too far, you can take action.
The federal Fair Debt Collection Practices Act, or FDCPA (15 U.S.C. § 1692 and following), prohibits debt collectors from engaging in abusive behavior. The FDCPA covers debt collectors who work for collection agencies. Sometimes, depending on the circumstances, debt buyers—businesses that regularly buy debts and try to collect on them—are covered as well. It does not cover the original creditor (the business or person who first extended you credit or loaned you money).
Debt collectors from collection agencies can't do any of the following:
Here's what you can do if debt collectors engage in illegal activity:
Under the FDCPA, you have the right to tell a collection agency employee to stop contacting you. Simply send a letter stating that you want the collection agency to cease all communications with you. All agency employees are then prohibited from contacting you, except to tell you that collection efforts have ended or that the collection agency or original creditor intends to sue you or take advantage of some other legal remedy.
Don't hide from debt collectors. You can tell a collector to stop calling even if the collector is not breaking the law. However, many debt counselors feel that, unless you're judgment proof—that is, broke for the foreseeable future—or truly plan to file for bankruptcy, the best overall advice is not to ignore the debt or try and hide from the debt collector. Usually, the longer you put off resolving the issue, the worse the situation and the consequences will become. Whether you negotiate directly with the collector or obtain a lawyer's assistance, many counselors feel the best strategy almost always is to speak to the collector. (Learn more about whether it's a good idea to tell a debt collector to stop contacting you.)
If a debt collector breaks the law, document the violation as soon as it happens. Start a log and write down what happened, when it happened, and who witnessed it. Then, try to have another person present (or on the phone) during all future communications with the collector.
In some states, you can record phone conversations without the debt collector's knowledge. In others, this tactic is illegal. Check with your state consumer protection agency to find out what is permitted where you live.
File a complaint with the FTC. File an official complaint with the Federal Trade Commission (FTC), the federal agency that oversees collection agencies. In your complaint:
Send the complaint to state agencies. Send a copy of your complaint to the state agency that regulates collection agencies for the state where the agency is located. To find the agency, call information in that state's capital city or check the state's website.
Send the complaint to the creditor and collection agency. Finally, send a copy of the FTC complaint to the original creditor and the collection agency. The original creditor might be concerned about its own liability and offer to cancel the debt.
Once your complaint is filed, don't expect immediate results. The FTC might take steps to sanction the agency if it has other complaints on record. The state agency might move more quickly to sue the collection agency or shut it down for egregious violations. Your best hope is that the creditor will offer to cancel the debt.
If you've been subject to repeated abusive behavior and can document it, consider suing the collection agency. But if the illegal behavior was merely annoying, don't bother. For example, if the collector called three times in one day but never again, you probably don't have a case.
To sue the debt collector, you can represent yourself in small claims court or hire a lawyer and go to regular court. (The other side may have to pay your attorneys' fees and court costs if you win.)
Money damages. If you win in court, you are entitled to recover:
If you need think a debt collector has violated the FDCPA when trying to collect a debt from you, consider talking to an attorney to get advice about your options and learn about the merits of a potential lawsuit.