Tips & Topics - Debt
Handle Debt Collectors
If you have received a debt collection notice or are receiving calls from debt collectors, the worst thing you can do is ignore them and hope they’ll go away. While it is generally not a pleasant experience for you, companies do have a right to try to collect money that is owed to them.
There are restrictions on debt collectors, however, including limits on where they can contact you (they may not call you at your place of employment) and on the time of day at which they may call you (usually not before 8 a.m. or after 9 p.m.).
The first and most important step you can take if you receive a debt collection notice or phone call is to verify the debt. If you believe the debt is not valid, you must dispute it within 30 days of being contacted by the collection agency. If you do not dispute the debt within 30 days, the collection agency may treat the debt as valid and may pursue the debt collection further. Here are four key steps to take if you have been contacted by a debt collector:
- Identify the debt collector and the debt. Request, verbally and in writing, the amount and proof of the debt (including the original amount of the debt and any interest, fees or other charges). Ask who the creditor is and what actions you should take if you do not believe you owe the money. Ask for the name of the caller, the collection agency and contact information.
- Establish privacy boundaries. Tell the collection agent that you only want to be contacted in writing, that they may not call you at work and that you are the only person to be contacted regarding this debt. Put these requests in writing using certified mail, return receipt requested. You may be contacted one more time by the collector to tell you its next steps.
- Keep a chronological record of all contact. This should include dates, times and copies of all communications, verbal and written, that take place between you and the collection agency. Keep copies of abusive or overly intrusive communications, and document these in writing. If you believe you are being treated unfairly, file a complaint with the Attorney General, the Consumer Protection Board, or the Federal Trade Commission (FTC).
- Carefully review the debt and respond accordingly. If the debt amount is accurate, yours, and legally collectable, try to work out a repayment plan. Get all terms in writing, including where to send payments. If the debt is not yours, if it has already been paid or if the amount is incorrect, follow steps to dispute the debt. Do not pay a bill you do not owe. This will serve as acceptance of the debt owed and will stay as a blemish on your credit report.
How to Dispute a Debt
If you believe the debt is not valid, you must write to the collection agency requesting that it discontinue contacting you regarding the debt (sending the request by certified mail is a good way to ensure the letter is received). The agency will be prohibited from contacting you again until it can provide proof that you indeed owe the original debt.
- The New York State Attorney General’s office offers tips and information on how to handle debt collection calls and what your rights are when you are being contacted by a debt collector. You may also contact the Attorney General’s consumer helpline at (800) 771-7755 if you need assistance on handling calls or believe that a debt collector has violated the law.
- The Federal Trade Commission has created a brochure to help you understand your rights under the Fair Debt Collection Practices Act. This act requires debt collectors to treat you fairly and prohibits certain debt collection practices. The brochure is also available in Spanish.