Feature Articles
Fair Debt Collection
Brenda Procter, State Specialist & Instructor, Personal Financial Planning, University of Missouri Extension
The Fair Debt Collection Practices Act requires debt collectors to treat you fairly and bans certain debt collection practices. The law does not erase any debt you actually owe. Personal, family, and household debts are covered under the Act.
A debt collector is anyone who collects debts you owe to some other party who hires them to collect from you. This includes attorneys who collect debts on a regular basis. Anyone you owe directly is not covered by this Act – only the people or companies they hire to collect for them.
A collector may contact you in person, by mail, telephone, telegram, or fax. Collectors may not contact you before 8:00 a.m. or after 9:00 p.m. unless you agree. A debt collector may not contact you at work if the collector knows that your employer disapproves.
You can stop a debt collector from contacting you by writing a letter telling them to stop. Once the collector receives your letter, they may not contact you again, except to say there will be no further contact or to notify you that the debt collector or the creditor intends to take some specific action. You could still be sued by the debt collector or your original creditor because you still owe the debt.
If you have an attorney, the debt collector must contact the attorney rather than you. If you do not have an attorney, a collector may contact other people, but only to find out where you live, what your phone number is, and where you work. Collectors usually are prohibited from contacting such third parties more than once. In most cases, the collector may not tell anyone other than you and your attorney that you owe money.
Within five days after you are first contacted, the collector must send you a written notice telling you the amount of money you owe; the name of the creditor that you owe; and what to do if you believe you do not owe the money. A collector may not contact you if, within 30 days after you receive the written notice, you send the collection agency a letter stating that you do not owe money. A collector can renew collection activities if you receive proof of the debt, such as a copy of a bill for the amount owed.
Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, debt collectors may not:
- use threats of violence or harm;
- publish a list of consumers who refuse to pay their debts (except to a credit bureau);
- use obscene or profane language; or
- repeatedly use the telephone to annoy someone.
Debt collectors may not use any false or misleading statements when collecting a debt. For example, debt collectors may not:
- falsely imply that they are attorneys or government representatives;
- falsely imply that you have committed a crime;
- falsely represent that they operate or work for a credit bureau;
- misrepresent the amount of your debt;
- indicate that papers being sent to you are legal forms when they are not; or
- indicate that papers being sent to you are not legal forms when they are.
Debt collectors also may not state that:
- you will be arrested if you do not pay your debt;
- they will seize, garnish, attach, or sell your property or wages, unless the collection agency or creditor intends to do so, and it is legal to do so; or
- actions, such as a lawsuit, will be taken against you, when such action legally may not be taken, or when they do not intend to take such action.
Debt collectors may not:
- give false credit information about you to anyone, including a credit bureau;
- send you anything that looks like an official document from a court or government agency when it is not;
- use a false name;
- collect more than you owe;
- deposit a post-dated check prematurely;
- deceive you to get you to accept collect calls or pay for telegrams;
- take or threaten to take your property unless this can be done legally; or
- contact you by postcard.
If you owe more than one debt, any payment you make must be applied to the specific debt you say. A debt collector may not apply a payment to any debt you believe you do not owe.
You have the right to sue a collector in a state or federal court up to one year after the date the law was violated. If you win, you may get back money for the damages you suffered plus an additional amount up to $1,000. You also get back court costs and attorney’s fees. A group of people can sue a debt collector and get back money for damages up to $500,000, or one percent of the collector’s net worth, whichever is less.
Report problems with a debt collector to the Missouri Attorney General’s toll-free Consumer Protection Hotline at 1-800-392-8222.
File a complaint with the Federal Trade Commission or
get free information on consumer issues at
www.ftc.gov or call
toll-free: 1-877-FTC-HELP (1-877-382-4357), TTY:
1-866-653-4261.
Adapted from Facts for Consumers, Fair Debt Collection, downloaded on October 13, 2008 from http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre18.shtm.
Last update: Monday, October 27, 2008
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