Did you take out a bigger loan than you can afford to repay? Are you now receiving several phone calls from collection agencies?
Having a large chunk of debt can affect more than just your credit score. Constant collection calls and daily letters can cause high anxiety. You may feel like there’s no way out or that you’ll be in debt forever.
Luckily, you have something called debtors’ rights. We are going to tell you what you need to know about these rights and how to use them. Keep reading for more information!
Debt Collectors Have Guidelines
Under the Fair Debt Collection Practices Act (FDCPA,) collections agencies can’t call you before 8:00 am or after 9:00 pm. They also cannot call your place of work if you have asked them not to do so.
Collectors also can’t tell other people about your debt but they can ask third parties for your contact information. They can’t use abusive language (which includes profanity or threats of violence) lie about how much you owe or to whom, nor can they claim to be law enforcement.
If the agency is threatening to garnish your wages or come after your property, they must have court-ordered rights to do so.
You Can Hire an Attorney
If the collection agency tells you that they are filing a lawsuit against you, you can take a default judgment or you can fight against your debt lawsuit by obtaining legal representation.
Once you retain a lawyer, the collectors can’t communicate with you anymore and must speak to your representative. At this point, your lawyer will look into whether you actually owe the debt, if the debt is within the statute of limitations, and if the collector filed suit in the correct court.
Make Payments Securely
If your attorney advises you to begin making payments, be sure to do so through a third-party or money order. Do not use checks or give full access to your bank account and routing number.
Unfortunately, some agencies will abuse this information and still withdraw funds even if you only have a few dollars left in your account. This will throw you into an overdraft situation and add even more fees to pay.
Sometimes this mistake has already been made. When you are noticing that payments are still being automatically withdrawn, speak with your bank. There are forms that allow you to stop all automatic payments to a company–unauthorizing their use.
Other Debtors’ Rights
Aside from the fact that debt collectors must follow the above rules, you have a few other debtors’ rights. A collection agency must inform you of the steps to take if the debt isn’t yours and stop contacting you when given written notice.
Remember that stopping the calls and letters won’t cancel your debt. You should probably speak to the agency at least once to confirm the debt is yours and how much you owe. You may also choose to ask for a payment plan.
However you choose to handle your debt situation, there are resources available to help.
If you enjoyed this article and would like more information about debt collections or other legal matters, check out the rest of our site!