When a bill collector calls you, his only goal is to convince or intimidate you into making a payment. While there is a law called the Fair Debt Collection Procedures Act (FDCPA) that governs the activities of debt collectors (but not necessarily the actual creditor), you should not assume anything that a bill collector tells you is truthful.
Understand that debt collectors are not acting in your interest. Debt collection companies get paid only if they recover money from you. They may get paid a percentage of what they collect or they may actually own the debt and are collecting for their own account.
No one likes to get debt collection phone calls or letters. The debt collector may imply or actually state that you are dishonest or dishonorable if you don’t pay the debt and they may pressure you into wiring money, giving the collector electronic access to your checking account, sending in post dated checks or borrowing against your retirement money or from a relative.
- You should never, ever, ever, give anyone electronic access to your checking account or issue an “electronic check.” You should never send anyone post dated checks or send out a check that will bounce (intentionally sending a bad check can be a criminal offense).
Despite what a debt collector may tell you there are no hard deadlines – you should never allow yourself to be pressured into doing anything when it comes to paying overdue debt.
Legally, a debt collector has very few alternatives. They can call you repeatedly (this is called “dunning” your account) or they can refer your file to a lawyer for possible litigation.
Litigation can be costly for the debt collector and you will always have 30 days after being served with a lawsuit to either file an answer or seek legal help.
You cannot be thrown in jail for not paying your debts and the debt collector cannot show up at your house to seize your assets.
FDCPA Provides Some Protection but it is a Weak Law
As noted above, the FDCPA mainly applies to debt collectors, not the actual creditor. The actual creditor (such as a credit card company or loan company) can legally take a very aggressive approach towards debt collection since there are few consequences.
Debt collectors are bound by the FDCPA and they cannot legally call your friends, relatives or neighbors to discuss your debts, nor can they call you in the middle of the night or early in the morning. They cannot curse you out or threaten a lawsuit when there is no actual intent to sue.
The FDCPA does offer some protection but it is a fairly weak law. The statute only allows for $1,000 damages plus whatever “actual damages” you can show. Further, it can be difficult to prove an FDCPA violation (in Georgia we do recommend that you record your phone calls).
Some debt collection companies figure that it is more profitable for them to improperly harass you and your friends or relatives than to abide by the law since so few people actually pursue a claim for FDCPA damages.
What to Do if You are Receiving Debt Collection Phone Calls
We advise our clients to avoid telephone contact with debt collectors. You have the legal right to demand that all phone contact be discontinued in favor of written contact. You can also legally request that all contact cease.
You should not, however, ignore the problem of having overdue debt. If you do nothing, there is a good chance that the debt collector will turn your file over for a lawsuit. Collection law firms operate on volume and they may file hundreds of lawsuits in a week with the expectation that 98% of those served will do nothing, resulting in a default judgment.
Judgments are dangerous because a judgment creditor can seize your bank account, garnish your wages or file a lien against your property.
If you are struggling with debt that you simply cannot pay, you would be wise to speak with a bankruptcy lawyer. Bankruptcy may or may not not be your best move but you will at least have a better understanding from a reliable source about your options.
