Most consumers know very little about the debt collection process or their rights for dealing with collectors, but they do know a lot about the stress associated with collections. There are some very important aspects of debt collections that every consumer should know in order to better protect themselves from abuse and resolve their debts effectively.
What To Know
It is important that consumers understand that debt collectors are quite limited in what they can collect, how they collect it and their overall interactions with consumers. Although most debt collectors will act knowledgeable and tough in negotiations, they are bound by very specific guidelines. First, a debt collector cannot use certain techniques when attempting to collect on a debt. Abusive or threatening language is prohibited, as well as the use of any deception or misleading statements. Second, debt collectors may not contact a debtor after hours, make collection attempts through certain modes and cannot violate the privacy of the debtor when collecting. Last, consumers have the right to negotiate with their creditor directly and not deal with the collector.
Consumers are also very limited in their knowledge of how to deal with collectors, should they choose to do so. When a past due account reaches the desk of a collector there is a good chance that a lawsuit could soon follow. If a debt collector is contacting a consumer to inform them of a lawsuit, the consumer has the right to take action to halt the lawsuit. There are two ways to halt a lawsuit (a) dispute the debt with the creditor or (b) file for bankruptcy. Disputing the debt can temporarily suspend the lawsuit while the creditor fulfills the requirement to verify the debt. Bankruptcy can grant further lawsuit protection by allowing the consumer and creditor to negotiate a payment plan or resolve the debt through the Chapter 7 process.