Debt Collection Practices -- FAQs
By Rick Rahim
Can a debt collector call me late at night?
No, collectors are only allowed to call you between the hours of 8:00 a.m. and 9:00 p.m. Earlier or later calls are prohibited under the Fair Credit Collection Practices Act. Debt collectors are responsible for knowing what time it is in every region of the country before they call you.
Can a debt collector leave messages on my answering machine?
Yes. A debt collector can leave messages on your answering machine unless you tell him to stop. But collectors cannot discuss your debt with third parties. That means they cannot leave messages about your debt on your employer's answering machine or a relative's answering machine. They can leave their name and number though, unless they are asked to stop.
Is a verbal agreement with a collection agency enforceable?
Most likely not. Be sure to get all agreements in writing. This is especially important because the collection industry has a high-turnover rate. Another collector might take over your account -- or your account might be sold to a third party. You should get all agreements in writing in order to protect yourself. A good written agreement (1) sets forth all material terms and conditions; and (2) is signed by both parties; and (3) is dated.
Does the collector have to take my partial payments?
No. Many collectors will claim they won't accept a partial payment. Collectors want you to send them a large lump sum payment. They don't care if you have to borrow it from a relative, miss a car payment or take a cash advance from your credit card. Many of them use very aggressive tactics to scare you into paying the debt in as quickly as possible. The smart thing to do is to pay only what you can afford. Keep making your house and car payments. Send your payment to the collector every month; even if they keep sending it back. Keep the evidence that you've been sending payments. This will reduce your chances of being sued because most collection attorneys know a judge, when presented with evidence that you tried to pay the debt, will not look favorably upon the plaintiff. Most collectors will give in and accept the partial payments.
A collection agency keeps harassing me about a debt I don't think I owe.
Send a certified letter demanding they verify the debt. Verifying the debt requires they send you documented proof of the debt. You can also ask them to stop contacting because you don't believe you owe the debt. Once you demanded they stop harassing you; they are prevented under the Fair Debt Collection Practices Act from contacting you to try and collect the debt or putting negative information on your credit report. But they can still contact you to tell you they're giving up all collection activity or they're going to sue you.
A collector told me he would call my employer to have my wages garnished. Can he do this?
No way. Not without a judge's signature. The Constitution of the United States guarantees you "due process." This means a collector must sue you first. And the matter must be heard in a court of law before your wages can be garnished. Your employer will not garnish your wages until he receives an official order from the court.
Does the Fair Debt Collection Practices Act apply to major credit card banks?
No. The law applies only to the collection attorneys and professional debt collection companies hired by the original creditor. Original creditors are regulated by state law. However, most major credit card companies follow policies that closely mirror those of the FDCPA. Most will comply with your request to stop calling you, as if you were dealing with a collection agency.
Rick Rahim is the President of the Online Business Bureau.