Collection Harassment

Collection Harassment  Resolving Debt

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Are you getting collection calls ?  Is your  desk is full of unpaid bills?.  Do you dread answering the phone?  Are you having trouble sleeping at night because you are worrying about a bunch of bills?  Do you feel depressed?.  If you answered yes  then maybe this article can help you.

   You are not alone.  There are many people with delinquent bills. You need to know that there can be light at the end of the tunnel.  This article is not meant to be legal advice. It is to let you know your rights under the law. 

    I will explain your rights under the Fair Debt Collection Practices Act (FDCPA).  This is legislation that was enacted in 1977 to stop abusive collection practices.

The FDCPA is a federal law.  The law provides for stiff penalties for debt collectors (i.e. the actual collector or the company or agency for which he/she works) for collections harassment.   This means that you do not have to put up with collection harassment or being insulted or threatened with such things as going to jail, criminal charges, seizing you wages, calling your employer or friends and family to tell them about the debt.  You do not deserve this type of treatment and should not stand for it.   They may not misrepresent themselves. They can’t tell you they are from the Sheriff’s Office, “warrants processing”, or an attorneys office (unless they do work for an attorney). Most of the abusive practices are done over the phone.  Letters and correspondence will usually comply with the law.

  They  also may not call you at work if they have a reason to know that you can't accept calls at work. If you get a call at work tell them not to call you at work any more. Under the FDCPA they must abide by that. Not only if you tell them, but anyone at the place of employment can tell them  not to call.

Calls at work---They may not call you before 8.am or after 9 pm in your   local time zone.  Contrary  to popular opinion, they can call you on a Sunday per the FDCPA. However if you state law prohibits it then they must not call. The FDCPA has precedence over state law unless state law provides more protection for the consumer.

      If you feel that you are a victim of collection harassment you have several options

         1) contact the supervisor or owner of the agency.  The one on the phone   is usually an hourly employee.  Higher ups  normally want their people to comply with the law as to prevent costly lawsuits against  them.

         2)  You may also notify them that they are not to call you again. This should be done in writing by certified mail with return receipt so that you have proof that you did advise them not to call you. This is a no call request.  You should only do this after repeated incidents. Why do I  say this ?  You may get one call where the collector is rude. The next one you get may not be. Having done collections for many years,  I often had calls where the person was angry from the last person  they had spoken to. But by working with them I was able to come to a mutually agreeable solution. So because you had one bad experience doesn’t mean they are all like that. Many collectors strive to stay within the law. But you do have the right to do this under the law.

     3)    FEDERAL TRADE COMMISION

     4)  consult an attorney.

      You don’t have to take collection harassment. Bear in mind also that they can’t harass you. Calling you one time every 3-7 days isn’t  harassment. Calling you repeatedly on the same day after they have done spoke to you may  be considered collection harassment. . An attorney can best determine if it is.

 Perhaps the problem isn’t that you are being harassed or abused. You are behind and don’t know what to do.  You know you owe the debt but don’t have the money to resolve it right now. Lets look at your options. Debt is either of 2 kinds. Secured  or unsecured.  A secured debt means that there is an asset that secures it, such as a house or a car.  Unsecured debt is normally a credit card or similar account.  With a secured debt the creditor has the right to take possession of the secured asset if you do not pay. You may also be liable for the balance of what was owed less what the creditor sold it for.  With an unsecured debt the debt continues going past due until it “charges off”. This means the creditor has to remove it from the books as an asset. This doesn’t mean they just “write it off” and the debt goes away. Typically they will either send it to a collection agency to try to recover or they may send it to a collection attorney to take action.  This  is up to the creditor to decide which action they will take.   

 Now less review your options.  

1)     Keep the lines of communication open between you and your creditor.  They want to work with you to resolve it. It does neither you nor them any good if they have to repo your car or charge off your account. If you have run into problems, let them know.

2)     Don’t promise something that you can’t do. If you can’t commit to an amount then don’t say  you will. Creditors normally keep track of the number of times you break your promises and it some case it may influence their actions later on.

3)     Most secured creditors will allow you to skip one or  two payments  and put it on the back of the loan. Each one has different  rules for this.

4)     Most unsecured creditors have programs to work with debtors.  The most prevalent one is a “reage” or “cure” program. For instance, your monthly payment is $50. You are 4 months behind. You don’t have the money to catch it up. But you could make that $50 a month payment now. I have seen this scenario many times in my years as a collector. The statement is wanting $200 and they can only do $50. With a “reage” or “cure” program  they would just have to resume making the $50 a month and after 3 months the account is current. Which means it will report to the credit bureau as current and it will not be getting late fees since it isn’t considered late any more.   Call your creditor and ask about a “reage” program. They may call it something else.

5)     Credit Card companies  have a minimum payment which is usually something like 2.5% of the balance plus any overlimit amount. I have seen many people get  behind and have their  credit affected by it because of this.  View the example

Credit limit	balance	Payment %	Minimum	MIN+ ovrlmt
1000	1100	3.0	$33	$133

 In this example the payment being requested by the credit card company is $133. The person may get this and be unable to pay the $133.   Instead they pay nothing. Hence their account goes past due. The next statement the  the amount is even greater since there was no payment the month before and it is even more overlimit because of finance charges, late fees and overlimit fees. However if the person had paid the $33(3% of balance) the account wouldn’t have went past due. It would still have gotten an overlimit fee but no late fees since it is still current on the payments. Check your  cardholder agreement to determine the minimum payment percentage.

 I realize this has been lengthy. I hope it has been of some help.  Check back again for the next article in this series. If you know someone this can help, please refer them to the site. If you have any questions please email me or post  a message in our forum. I am also available for personal consultation.

RESOLVING DEBT PART 2

 

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