An account sent to collections can be stressful and for most, it is mortifying! Especially if the debt simply got out of control due to unforeseen circumstances (COVID19) — it can happen to the best of us. After receiving several annoying phone calls or opening the dreaded collection letter, your life seems out of control and the worst-case scenarios run rampant. Take a deep breath and know that help is available.
Understanding what a debt collector is and how the process works is the first step in resolving your debt. Typically, unpaid debts get assigned to a collection agency. These agencies are in the business of recovering money owed on delinquent accounts. Your original creditor sent the debt to a third-party person or agency to collect it. Credit card debt, mortgages, auto loans and student loans are a few types of debt that can be passed on to a debt collection agency.
Should You Speak with a Collector?
Your first response may be to speak with the debt collector and explain the reasons behind the missed payments. Wrong. Debt collectors are not interested in your “Why” — they are only concerned with settling the debt. Be prepared and know your options before attempting to negotiate and please do not panic, most importantly, do not ignore the debt collectors. Rather than letting the phone call go to voicemail, or hitting ignore, educate yourself about your rights; how the delinquent debt affects your credit, and what are your best options for working with debt collectors. Examine your financial situation and be realistic with how much you can afford to pay on the debt each month.
Even though negotiating with a debt collector can be intimidating, the good news is, there are protections for consumers in difficult financial situations. The Fair Debt Collection Practices Act (FDCPA) is a federal law governing debt collectors and how they conduct business. The Act defines the rights of consumers involved with debt collectors and prescribes penalties and remedies for violations of the FDCPA.
How Does the Fair Debt Collection Practices Act Protect You?
The FDCPA clearly sets out that a debt collector may not engage in unfair practices when they try to collect a debt. The unfair practices include but are not limited to:
- Called you about a debt you do not owe after you informed the collector you do not owe the debt;
- Called you at work after you told them you cannot receive such calls at work; and
- Called third parties (family, friends, coworkers, or neighbors) even though the collection agency knows your contact information.
Debt collectors are also prohibited from saying:
- You will be arrested if you do not pay your debt,
- They will seize, garnish, or sell your property, unless they are permitted by law to take the action and intend to do so; or
- Legal action will be taken against you and if taking such action would be illegal or if they do not intend to take the action.
The law requires a debt collector send you a written notice within five days of contacting you for the first time with the following information:
- How much money you owe on the debt.
- The name of the Debt Collection Agency.
- Steps needed to dispute the debt.
In the event a collection agency has harassed you and you are distressed over the debt, seek the services of a third party. Remember you have options and rights when life deals you a financial blow and you are going through the complicated process. If a collection agency violates the FDCA, you may be entitled to statutory damages up to $1,000.00, plus the collection agency has to pay your attorney’s fees and costs The FDCA also has a fee-shift provision. This means, the collection agency pays your attorney’s fees and costs.
About Agruss Law Firm
Founded in 2012, Agruss Law Firm is a national consumer rights law firm. We help consumers stop debt collection harassment, fix inaccurate credit reports, and we also go after big businesses for deceptive practices. Under state and federal laws, we will help you based on a fee-shift provision and/or contingency fee, which means the other side pays your attorney’s fees and costs. You will not owe us a dime for our services. We have settled thousands of consumer rights cases, and we are prepared to help you, too. Contact Agruss Law Firm at 888-572-0176 for FREE, no obligation consultation.
Agruss Law Firm, LLC
4809 N. Ravenswood Ave, Suite 419, Chicago, IL 60640