It happens to the best of us. An emergency comes up, and you've go unexpected expenses. Perhaps a bill payment slipped your mind. Perhaps your past payment record with a debt was less than...responsible. Now, the debt collector is calling, and they aren't playing nice. What do you do?

If this sounds like an experience you have had, you first need to know your rights as a creditor, and how to deal with debt collectors. The Fair Debt Collection Practices Act spells out these rights, and what debt collectors can and can't do. For example, debt collectors can't threaten to throw you in jail in you don't pay your debt (there is no debtor's prison in the U.S.). They can't threaten to sue you if they have no intention of doing so. They can't continue to call you if you have notified them in writing to stop. They cannot falsely claim they are attorneys or call you all hours of the day or night. The Federal Trade Commission has a pretty good overview of the Fair Debt Collection Practices Act on their website.

So now that you know your rights, how do you address this pesky debt and the collection calls?

1. Don't assume you owe the debt. You may not even actually owe the debt, or the amount the debt collector says you do. You have the right to request validation of the debt. Send the debt collector a letter (always do this in writing and always send the letter certified, return receipt requested, so they can't claim they didn't receive it) asking for validation of the debt. If they can't provide proof, they can't keep hounding you for the money. Don't admit the debt is yours until they can provide proof.

2. If you owe the debt, ask for a payment plan if you need one. Always get the details of this plan in writing, and never, ever give the debt collector your bank account information and let them do automatic debits. They can, and will, take out the amount of the entire debt if you've got the money in your account.

3. Find out the statute of limitations on the debt. Debt collectors can't chase you for years seeking payment for a debt. There is a statute of limitations on debt. Find out what it is for your state. Scavenger or "zombie" debt collectors will purchase old debts for pennies on the dollar and come after you for the full amount. If the debt is past the statue of limitations, don't even reply to them. The exceptions to this are tax payments, student loans, child support and civil judgments.

Keep in mind, not all debt collectors are unethical. They have a job to do, too. They just want to collect money for a debt that is owed. But, there are also some bad actors out there, and knowing your rights and how to deal with them is the best way to protect yourself and your credit score.


  1. RBDC // January 14, 2012 at 7:00 AM  

    How to reverse boycott debt collectors.

    When a debt collector/debt collection/debt buyer company can repeatedly call with the intent of getting money their customers can repeatedly answer or call back with the intent of not giving them any. They need people to pay with as little talk as possible. They don't want to talk with people who know they are never going to pay. Be all talk and no pay. Answer when convenient. Call back. Give no information. Verify nothing. Ask as many questions as you can. Answer none.

    Don't ignore/block/report them. It doesn't work. These folks want you to ignore them for as long as you can stand to or until you give them something valuable like money or information. Ignoring them is being their good customer. Sending a cease and desist is giving information. It lets them know you are still alive and remain their good customer. Preparing to initiate unlikely individual legal battles is being their good customer.

    Be their bad customer. Make them talk to you fruitlessly for as long as they can stand to or until they stop selecting you as their customer. These companies cannot spend seconds much less minutes on the phone with every person who will never send them a dime. But they don't know who that is. You do. That knowledge is power. Every second you can keep their staff on the phone will render their business less profitable giving them a reason to never call you again.

    Calling will not reset your SOL. Making a partial payment will.

    One person who does this likes to ask general questions they should but usually won't answer, "May I have the name and address of your agent for service of process?" Calmly and slowly ask them to spell every word in the address. Read it back for verification. Control the pace. If they are rushing then politely ask them to slowly repeat. "Are you a corporation and if so in which state are you incorporated?" Repeat your questions when you don't get direct answers. When they won't answer a question ask, "Would you like to comply with the business and professions codes of your state?" That is usually the point when they hang up on me but if they say they want to comply then begin your questions again.

    Repeat while you have the spare time. These folks have many victims and few operators. If everyone calls back but pays nothing the mass auto-dialer business model becomes unprofitable. Don't aid and comfort the enemy by ignoring them. Call! Have a nice long slow friendly chat! Make them hang up first.

    Press 2 for Spanish.

    There are certainly enough victims to take down debt collectors so ignoring/blocking seems downright Orwellian. Really? We're just going to passively submit and go with a block list or however we manage ignoring an endless stream of unwanted phone calls day after day? No! Unite or remain conquered. Answer/return every call - become well practiced at keeping these folks on the phone - or count yourself not amongst the free.

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