Picking up the phone and realizing a debt collector is on the other end is a stomach-dropping experience. It is also a conversation that can have numerous potential implications, which is why it’s essential to know ahead of time how to navigate the call when the time comes.
Unfortunately, these conversations are becoming more prevalent amid soaring credit card bills and unpaid medical debt. “Lawsuits filed by debt collectors over unpaid credit card bills and other outstanding balances have surged to their highest levels in years,” said the Pew Charitable Trusts, per The Wall Street Journal. Here is how to prepare.
You have a right to know the facts.
Believe it or not, “many sold debts have errors about the amount owed or even who owes it,” said NerdWallet. So, as soon as you hear from a debt collector, first verify all of the details to ensure they are accurate.
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When a debt collector contacts you, they are actually legally required to provide you with certain information about the debt within five days. But do not just take their word for it — you should also “gather your own records, including information on the original creditor and your history of payments,” said NerdWallet.
You should be cautious about what you share.
Watch what you say when speaking with debt collectors, as it could work against you later. For instance, avoid offering personal financial information, including your bank account number or details on your assets, as this “might be used to collect from you through a wage garnishment, bank levy or property lien if the creditor or collector gets a judgment against you,” said Nolo.
Similarly, avoid making any promises regarding the debt. “Your acknowledgment of the obligation might revive the statute of limitations” or the length of time the creditor has to take legal action to collect the debt, said Nolo.
You should absolutely keep detailed records.
As you navigate communicating with debt collectors, make note of what is said and who you talk to, as well as the date and time of the call. This is important because it “will help you determine who’s calling you from where and what debt each collector calls about,” said Nolo. You can also “track how often a particular collector calls and document inconsistencies in what collectors say to you from one call to the next.” You will be glad to have this info in case you need to file a complaint or you end up in court.
While working with a debt collector can help you resolve your debt, if it feels overwhelming or you have any hesitations, you have the right to ask them to stop contacting you. You can draft a letter saying as much using one of the forms on the Consumer Financial Protection Bureau (CFPB) website, and the debt collector is obligated to comply. Just keep in mind that if the debt is yours, “stopping communication with a debt collector doesn’t make the debt go away,” said the CFPB.
You have protection against certain types of communications.
Under the Fair Debt Collection Practices Act, debt collectors cannot harass or threaten you. Prohibited behavior ranges from “repeatedly calling you at any time, day or night or before 8 a.m. or after 9 p.m.” to using “any false, deceptive or misleading representation,” said Experian. If you think a debt collector may have violated your rights, be sure to submit a complaint with the CFPB.
