Fair Debt Collection Law Know Your Rights As A Debtor!

Fair Debt Collection Law. When you've fallen behind on your debt payments because of cash flow problems, you have the Fair Debt Collection Law, also known as the Fair Debt Collectors Act, to protect you against embarrassing debt collection practices.

The law lays down strict rules which credit collection agencies and individual debt collectors must follow while you work out ways to pay back your debt.

Fair Debt Collection Law, Facts Debt Collection Companies Do Not Want Known

Know Your Rights

Unfortunately, many debtors are not aware of the debt collector law and it makes them helpless against the usual debt collector tactics of intimidation and threats. By knowing all you can about debt collectors and your rights, you can stop abuse in its tracks and keep your dignity intact through the sensitive process of reclaiming your creditworthiness.

Making Contact

Under Law, collectors must contact a debtor about a claim and make it official by mailing a letter of notification after five days. The letter must indicate the exact amount of debt being collected as well as the creditor to which the money is owed. The notification must also outline instructions on what the debtor must do to dispute the claim.

Upon receipt of the notification letter, the debtor has thirty days to reply and disown the debt. If he does, the collector is legally constrained from making any subsequent contact and can only reopen talks after finding proof to the contrary.

Pay Attention to the Rules

Assuming that collection proceedings have been initiated, aggressive debt collectors will press on the claim and debtors can keep them in line by insisting on the rules as mandated by law.

Topping the list is the protection of the debtor's privacy. Collectors are allowed to phone, email, or make a personal visit only from 8:00 a.m. up to 9:00 p.m.

Calls may be made to the debtor's place of work as long as they do not cause unnecessary interruptions. They must be immediately stopped if the employer prohibits personal calls in the workplace.

The most important aspect of the privacy rule is the prohibition against contacting any third party other than the debtor, the debtor's spouse, and lawyer. Friends, neighbors, and office mates must not be involved in any way.

In some cases, they may be asked about the debtor's whereabouts, but they can not be told that the inquiry is connected with an ongoing debt recovery. Similarly, debt collectors are forbidden against sending envelopes that contain outside markings and symbols that identify them as coming from a debt collector.

Rounding up the guidelines are the following:

  • Collectors must stop contacting debtors regarding a particular debt after the latter have written them to do so. Communication can only be resumed to report any new actions which the collection agency is taking to collect the debt.
  • Debt collectors must properly identify themselves whenever they communicate with debtors.
  • Collection agencies must not charge any unauthorized interest or other fees.
  • Debt collectors are obliged to maintain ethical conduct at all times and are prohibited against making any insulting remarks or intimidating and false statements to the debtor.
No doubt, the Fair Debt Collection Law had been envisioned to protect debtor's rights. However, it does not free the debtor from obligation and encourages both debtor and collector to work together and amicably settle the claim at the soonest possible time.

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