It is amazing how many people do not know their rights when it comes to debt collection. You can stop debt collection agencies from hounding you day and night and deal with them in your own terms. This article will explain how.

The Fair Debt Collection Practices Act (FDCPA) is the federal law that says what debt collection agencies can do or not do when collecting a debt from an individual. This law protects consumers from undue harassment.

One of your rights under that law is to put stop to all communication from a collection agency. However this part should be used judiciously as it can backfire in your face. There are instances when some form of communication should be left open. More on How to Stop Collection Agencies Dead On Their Tracks

Debt collectors ringing your phone off the hook and sending intimidating letters can frazzle anyone’s nerves. But you have various forms of protection and many techniques available to deal with them.

The Fair Debt Collection Practices Act sets guidelines for what debt collectors may or may not legally do when attempting to collect a debt. They can’t, for example, call before 8 a.m. Or after 9 p.m., nor threaten to garnish wages in states in which it’s illegal, or harass you with continual phone calls if you tell them to stop. More on More Tips on How To Deal With Debt Collectors

Thinking of taking legal action against debt collectors? Many people become so overwhelmed with debt we forget there are guidelines for debt collectors to follow and we can take action against these companies. 

Debt collectors are bound by the Fair Debt Collectors Act and it only takes a little education for us to become aware of just how far debt collectors are allowed to take their demands.

More on Legal Action Against Debt Collectors

Debt collectors will contact you and harass you to collect on a debt you owe.  You may recollect the debt and perhaps you don’t.  It really doesn’t matter, you have the right to dispute any debt and would you really send your hard earned money to anyone calling telling you to send money for a past debt owed?  I wouldn’t because I need to see proof that I am the responsible party.  But some debt collectors make it difficult, calling work and home, leaving threats.  You can end the harassment with one Cease and Desist letter.  

This letter shows them you know your rights and you intend to hold them accountable if they do not follow the Fair Debt Collections Act.  Below is a sample of the letter you can send them to stop the harassment of daily phone calls. 

More on Sample Dispute Letter to Send to Debt Collectors

By: Shannon (Guest writer)

Let’s begin with Guarded Secrets #3 that Debt Collectors try and hide from consumers. The biggest secret that Debt Collectors and Debt Collection Agencies don’t want consumers to find out is many debt collection agencies cannot try and collect any money from you.

Note: Part 1 of this two-part article is published here.

Many of them are doing business illegally. You see ALL debt collectors must be licensed and bonded. You can go to your State Assessments website to check the debt collection agencies license. Remember, having a business license is the first step. They must also be bonded. In lieu of checking via the internet, you can call your state attorney general’s office to check and see if they are licensed.

If you find that the debt collection agency is not licensed simply write them a letter explaining that according to your Attorney General’s office, that company is not listed and you do not support or encourage unlicensed businesses in your state.

Therefore, you are unable to provide any further information until that Debt Collection Agency can show that they are licensed and bonded in your state. Funny right!  Yes, I have sent many letters like this and never heard from the Debt Collection Agency again.

An unlicensed company that is doing business in your state can be sued, and you can inform them of this just to let them know you are educated in your consumer laws.

Guarded Secret #4: Many consumers don’t know anything about Statute of Limitations. This is the time period that any legal action can be initiated. Once the Statute of Limitations runs out your obligation to repay expires.

For example, you get a credit card and don’t pay the balance off and 10 years go by and suddenly you hear from a debt collection agency telling you they are collecting on this past credit card debt. They cannot legally collect because the statute of limitations has passed. Simply explain that the statute of limitations has passed and hang up the phone. No other explanation is necessary because the Debt Collector will know exactly what you’re referring to.

Each state has their Statute of Limitations, so you should check into your specific state information.

These are simple legal strategies that every consumer is afforded. No one is willing to tell us that most of our debt we do not have to pay back. We must educate ourselves and learn how to stay ahead of the curve. If you don’t you could be paying a lot more than you have to.

Don’t forget to check out part 1 of this article if you missed it.

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Debt Collection is an industry that works for the creditor to recover all the money you owe. They will do anything to recover their money; harassment via daily phone calls, threats to expose your debts and letters, many letters to recover the principal and interest owed.

Sure, there are federal and state laws to help the consumer, but when consumed with guilt and overwhelmed with the financial pitfall we’ve created it’s often easier for us to give in to their threats, not knowing we don’t have to.

And even those obvious laws don’t stop aggressive debt collectors. Don’t expect them to share the rules and regulations with you. But what about the little known tips and tricks that can stop them dead in their tracks?

Did You Know;

1. Debt Collectors cannot legally collect a debt unless they are registered in your state?

2. Debt Collectors must register with monetary regulators in your state before they can collect any debt or contact any consumer.

3. They must position a usury bond before performing any business in that state.

4. Third, the majority of debt collectors are not the owners of the bad debt; they are only working for the original creditor to recover what is owed.

When a debt collector contacts you, there are some specific questions you must ask before responding to them. Keep in mind, a debt collector is calling to (a) talk or threaten you into paying your debt (b) calling to get as much information on you as possible. There are various ways to deal with these scenarios.

1. Ask the debt collector what is the original creditor’s name.

2. Tell the collector point blank, you do not recall incurring any debt with that named company.

3. Most importantly, request proof or validation of the debt. They will have 30 days to send you proof.

4. Do not give out any other information. Debt collectors will ask to verify information. They only want to make sure you live and work at the same place and they are able to keep in contact with you.

Very important: Never acknowledge a debt with a collector. Doing this can restart the statute of limitations, that is, the time limit that a creditor has to sue you for non-payment, as well as the seven year credit-reporting limit.

Another technique you can try, that will only stall the collection cycle is telling the collector, “I don’t deal or discuss any debts with third party agencies and I must contact the original creditor to converse about this.”

And finally, there are many debt collection companies that purchase the debt for pennies and then try and collect on it. Your debt was sold primarily because the original creditor could not successfully collect on it.

But just think about it. If the original creditor could not collect on it, how would a debt collector become a better source to recovering old debt? They can’t; but consumers don’t realize this and by the time it makes its way onto the credit report, consumers give up.

You can stop debt collectors in their tracks, without giving up your hard earned money. The learning process is easy if you’re willing to fight back.

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