Creditors Gone Wild:
Having Debt is not a Free Pass for Debt Collectors to Abuse You
Collectors must be careful to abide by the Federal and State procedures that apply due to the fact that people’s financial problems have the capacity to be a sensitive issue. The Federal Trade Commission says that a collector must positively identify the person who owes money before they can announce that the purpose of the call is to collect debt. The bill collector will then issue a statement, sometimes known as a “mini-Miranda” that lets the customer know that they are in fact a debt collector. Collectors also must follow the state laws that say how they must proceed. A lot of companies utilize electronic systems now to help bill collectors remember all of the laws and regulations regarding each call.
No matter what organization that they employed by, the goals of bill collectors are the same. First, they’re called upon to locate businesses or people that are in debt, and let them know that they are late. Typically this will be over the phone, but sometimes they mail out letters. When debtors (people in debt) move without leaving a forwarding address, bill collectors might check with telephone companies, the post office, credit bureaus and former neighbors to get the new address. This practice is called “skip tracing.” They’ll use computer systems to automatically track when people or companies change their addresses or contact information on any of their open accounts.
The information above explains the process and tools that collectors implement, what is unknown to many Americans is that often debt collectors are on a commission basis, meaning they do not get paid until the debt is paid. This payment structure can lead some debt collectors to engage in abusive and unethical practices in attempts to get the debtor to “pay up”. Examples include leaving messages with a third party at the debtor’s workplace, threatening calls with foul language or a barrage of calls at all hours intended to harass the individual into paying that particular debt collector first.
Americans with debt and financial hardship are typically already suffering from stress, unfavorable credit scores, pay cuts, layoffs and other aspects of this declining economy. While credit collectors are performing a contracted service, they do not have the right to engage in abusive practices and harassment. Violation of the Fair Debt Collect Practices Act is a reason to take a collector to court. In 2009 there were over 8000 consumer lawsuits filed against collection companies, that number is expected to grow in 2010. Know your rights and do not fall victim to the scare tactics of collection agencies. Seeking counsel and direction from a licensed attorney can accomplish 2 things: identify the most favorable debt resolution strategy for your personal situation as well as protecting your privacy and rights.