How to Deal with Debt Collection Agencies

Debt collection agencies can be annoying. Can you do anything about it? Read on to find out. A debt collection agency is a company that collects debts for creditors. They pressure you to pay the debt through letters, phone calls, and even lawsuits. The two major types of debt collectors include internal collection departments and third-party debt collectors. When your debt is 90 to 180 days due, you will most likely deal with internal collection departments—your original creditor. At this point, you can negotiate and come to an agreement.

Once the 90 – 180 days are over, your creditor might sell your debt to a collection agency or contract them. The debt collectors can be ruthless and if you decide to negotiate with them, do it in writing. There are things that collection agencies are allowed or not allowed to do by the law. The FDCPA protects you from deceptive tactics and abuse from these agencies, even if you owe the debt.

The collection agency can only talk to you, maybe your spouse, and your attorney about your debt. They can try to contact friends and family to get your contact information. They are not, however, allowed to harass them with phone calls. Can they withhold information regarding a debt? They cannot do that legally.

They are supposed to write to you within 5 days since they first contacted you, notifying you of your right to file a dispute. It is your right to ask for the debt validation and information of the original creditor. Can they keep calling after you have asked them not to?

A phone call telling them not to may not do it. Write to them instead. From there, they can only contact you once telling you of the action they will take. Can they keep harassing you for a debt you do not owe? No, they cannot. If the debt collector cannot verify the debt, they cannot make collection attempts.

Can they garnish your wages? This depends on your state regulations. If your state does not allow it, the debt collector cannot threaten it—it is illegal. Can they ruin your credit? Collections agencies cannot damage your credit themselves but a collection account on your report can. If the debt is sold several times, you will end up with several collection accounts and this could be tragic to your score.

Your Rights, As Far as Collection Agencies Are Concerned You have the following rights under the FDCPA. Debt validation, Coverage of all personal debts, Protection against harassment by debt collectors, Collection agencies are required to be totally honest, and Debt collectors cannot issue empty threats. 

More Tips on How to Deal with Collection Agencies

Avoid talking to them via phone

If you must, record phone conversations with them

Do not believe them

Avoid negotiations or repayment during the validation process

Do not hide money

Avoid applying for new credit

Do not ignore the situation

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