Collection agencies are not here to negotiate. They are paid to pull back the due amounts from you, and they will try their best to make you pay the total debt you owe, not even a penny less.
Nearly all debtors complain that their life has been turned to hell because of these debt collectors. They don’t let anyone live in peace. They call at home, at workplace, contact neighbors, threat relatives, and so on.
But we still have various options to deal with these collectors. You can sue them if you believe their means of collecting debts is harassing and unjust.
In this post, we will keep you informed by listing out 5 facts every debtor dealing with collection agencies must know.
1 The statute of limitations:
For every debt, you have statute of limitations.
To cut it short, if you think that the statute of limitations is passed for that debt, then you may not have to pay back the due amount.
For every state the rules are different. Each state has its own distinct statute of limitations.
So, whenever you are approached by any collector for a debt, that you believe is too old to be paid off, then you can definitely take a look if the statute of limitations has passed or not.
But to keep in mind that a collector can still come down to collect expired debts.
Moreover, they can even sue you if you don’t agree to pay it off.
You must have a thorough discussion with your lawyer, who can help you have a good defense in court if you are sued for a debt that’s expired.
2 The letter of validation:
Once you check the statute of limitations, you should contact the collection agency and send them a debt validation letter.
The letter should ask them to verify whether or not they are authorized to collect the debt from you.
Every collection agency is bound to answer such a letter with evidence of a valid proof that they are licensed to collect the debt from you.
If the collection agency does not reply you back in a written document, then you can straightaway sue the agency as they are breaking the FDCPA rules.
An agency is bound to answer your letter. But remember you should not ask the collection agency over the telephone about their validation. You should also send them a written letter. Else you will be in a false position later on.
3 The FDCPA Rules:
The Fair Debt Collection Practices Act has laid out some rules and regulations that no collection agency can avoid. The rules are simple but often times the agencies break them either purposefully or unknowingly in the moment’s heat.
Here are a few rules:
- The first contact must be made over the telephone, and the collection agency cannot come to your place of residence or your workplace, or any of your relative’s home or workplace.
- The collection agency cannot use unfair means to disturb or harass you. Neither can they threat you and injure you, nor can they destroy your property.
- The collectors should not come in a false disguise and say they are licensed to collect the debt from you.
- They can only contact you between 8:00 am to 9:00 pm, unless you give them any other specific time to call or reach you. If you ask them not to call or contact you again, then they must cease all procedures of contacting you. If they still call or meet you in person, then they are violating the FDCPA rules, and you can sue them in court.
4 Hire a lawyer and try out debt settlement:
Dealing with a collection agency alone is not that easy. You should know each law of FDCPA minutely and must be able to fight them tactfully.
In most cases, people fall into deep trouble when their debts are passed onto collection agencies.
The collectors are not even in a mood to negotiate and you are not in a position to argue if they are totally authorized and licensed to collect the debt from you.
So I would suggest you go for an attorney’s help and see if you can try out debt settlement.
If a settlement goes right, then you will be paying a lump sum and walking out clean of the mess.
If the debt is old and there are little chances of you paying it back in full, then the creditor will agree that it’s better to have something than nothing.
5 Bankruptcy is an option to bring everything to an end:
Again there are times when debt can’t be settled, and by no means, it can be paid off. Then bankruptcy is a shining option.
You can truly file bankruptcy if you believe you want a fresh start in your life and you just need to cut clean this mess.
Bankruptcy has its own pros and cons. But to discuss them here is not my intention. So you better have a talk with a financial coach or a lawyer and see what bankruptcy chapters are you qualifying for and whether or not should you even file bankruptcy.
That’s all I had to say about the few basic things you should know of, if you are troubled by collection agencies.
