No one in their right mind actually wants to be in debt. Unfortunately, far too many of us find ourselves in this position at least once in our lives. It may be due to the loss of a job, divorce, or it may even be because we over-extended ourselves, not realizing the depths that we were sinking to. When these unfortunate circumstances occur, it’s good to arm yourself with knowledge of the law. Not knowing the law can result in violation of your rights.
If you have just gotten yourself into a situation where you are getting calls from creditors, don’t expect any sympathy from them. They are there to collect money, and will often resort to unscrupulous means to do so. These people are not your friends. If you had the money to pay them, chances are you would have paid already, so arguing with them does not help your situation. This is where you have to be aware of certain rules that they have to follow according to the fair debt collection practices act. Many of the debt collectors don’t seem to be familiar with this law, and will try to use strong arm tactics to get you to pay up.
Debt collectors are not to call between 9pm and 8am. I have had a few that try to call after 9pm. If they call between those hours, you can simply tell them that they are violating the FDCPA, and you don’t have to speak with them beyond that. If they continue, report them to the fair trade commision.
Debt collectors are not allowed to threaten you with jailtime. Some will try. Some debt collectors will even try this when you don’t owe the debt (I had this happen to me once). There is no debtor’s prison in the United States ever since John Adams did away with it during his term as president. With him being the second president, it’s been a long time. The only exception is child support and that’s another story.
Debt collectors are not allowed to identify themselves as attorneys unless they actually have the credentials to do so. In this case, it’s pretty difficult to check their credentials over the phone, but be wary of any debt collector identifying himself as a lawyer.
They are not allowed to tell your children, your parents, or even your spouse about your debt. They are also not allowed to leave messages identifying the debt. Many debt collectors do this anyway, but it is illegal and can be reported.
They cannot collect on any debt that is past the statute of limitations. This varies from state to state, so look up the laws in your state, but no debt is collectible for more than 7 years. If it is still on your credit report after that, you can ask to have it removed. Between the time that it becomes delinquent and the time that it is removed from your credit report, pay it in full if you pay anything at all, because paying small amounts may make you feel better but it will only reset the clock for the statute of limitations, and you don’t want that. If a collector calls about old debt, this is called zombie debt, and you just have to tell them that you know nothing about the debt. There is nothing they can do.
There is a lot more to the FDCPA, but these are the most common violations of it that you need to be aware of. Stay out of debt if you can, but if you cannot, arm yourself with as much knowledge as possible.