The following is a guest post from fellow blogger Jerry Coffey of Repaid.org. If you are interested in guest posting, please see our guest posting guidelines.
Having debts you’re struggling to pay is a sad state of affairs, and non-stop phone calls from debt collectors only makes the situation worse. Unchecked, your phone may ring every couple of hours all day long and well into the night. Fortunately, there are steps that you can take to stop collection calls.
Answer The Phone
Ignoring the calls will not help. Debt collectors have nothing else to do but hassle you, so talk to them. Keep a pencil and paper handy, though. Ask what specific debt the company is trying to collect. Get the name of the company, your account number, the company’s address, its phone number, and the name of the person that you are speaking to. Collection agencies are required to provide this information. After getting all of that info, clearly state that the company is to stop contacting you by phone. Be sure to emphasize that they are not to call you at home or at work. Do not give any personal information, and do not acknowledge or make a payment on the debt at this time. You need to confirm that you’re dealing with a legitimate collection agency and a valid, unexpired debt. By acknowledging the debt or making a payment, you could risk reaffirming a debt that’s actually past the statute of limitations (SOL).
Verify The Company
Scams are everywhere. Debt collection scams abound. A simple internet research should show you whether the company is legitimate or not. You may find that the company exists, but at a different address than the one you were given. This is a sure sign that someone is trying to run a scam on you. You can also check your state’s Department of Consumer Affairs and/or State Attorney’s office to determine if the company is licensed in your state. If they claim to be associated with an attorney’s office, you can check with the state bar association. Collectors must send you a written confirmation of the debt within five days of their first call. This letter should include all of the company’s contact information.
Send a Letter
Believe it or not, some debt collectors (real or scam) will keep calling you after you ask them to stop. Yes, that was tongue in cheek. You will need to send a cease and desist letter to the company. Under the Fair Debt Collection Practices Act (FDCPA), debt collectors must stop collection calls if you send a cease and desist letter, but not until they receive the letter. Send your letter certified mail. Here is a sample letter:
Date
Your Name
Address
City, State ZipDebt Collector’s Name
Address
City, State ZipRe: Account Number
Dear Debt Collector:
Pursuant to my rights under the Fair Debt Collection Practices Act, I request that you cease and desist communication with me, along with my family and friends, in relation to this and all other alleged debts which you are claiming that I owe.
If you do not comply with this request, I will immediately file a complaint with the Federal Trade Commission and the [your state here] Attorney General’s office, and civil and criminal claims will be pursued.
Sincerely,
Your Name
File a Complaint
If the company does not stop calling or if you suspect that there is a scam afoot, contact the Federal Trade Commission at 1-877-FTC-HELP (382-4357). You should also contact your state’s Attorney General. Most states now allow you to submit complaints electronically. If you mail in your complaint form, don’t send the originals of any documents you want to include. Send copies and keep the originals for your own records.
Get a Lawyer
Occasionally even a legitimate company will continue to violate the Fair Debt Collection Practices Act. The only way to stop this is to sue. A sad aspect of the debt collection industry is that there are very few ethical companies in the business, so you must take away their profits to get them to reevaluate their tactics. There are many attorneys that will give you a free consultation, so set up an appointment to find out if you have a case or not. You can simply search Google for an “FDCPA attorney” in your area.
Hopefully, you will find a few of these tips helpful and be able to put a stop to those annoying phone calls. Once you do, you’ll be in a much better position to begin taking control of your finances and eliminating your debt!
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This is a guest post from Jerry Coffey, who blogs over at Repaid.org. After years as a “debtaholic,” Jerry paid off more than $10,000 in credit card debt in just over two years through smart budgeting and frugal living. You can follow Repaid.org on Twitter @RepaidOrg.
It’s a shame the way some people are willing to prey on others. Some of these companies will buy debt that’s past it’s statues of limitations for pennies on the dollars just for the off chance that you might actually be strong armed into paying. This is an industry that definitely needs more regulating.
Justin@TheFrugalPath recently posted..Money Mistakes I Made Over the Last Decade
Definitely, Justin – strong-armed, or simply tricked into reaffirming a debt that’s past the SOL. Consumers actually have a lot of rights – the problem is that they don’t what those rights are. So I think education is really lacking. Hopefully this post and others from all of our blogs/sites will help!
Taylor @ Repaid.org recently posted..Why Worry About One Late Payment?
It really is all about opening a dialogue. A lot of times these aren’t pleasant people to deal with, however it gets much harder if your ignore it.
Jamie Dickinson recently posted..Shopping Via Your Mobile
There is nothing nice about the debt collection business. All to often people get into debt and feel like there is no escape, particularly when the debt collectors won’t leave you alone. I think this article provides a lot of really good ideas to help deal with the situation.
Glen @ Monster Piggy Bank recently posted..Using Coupons to Save Money
Glen you are so right about debt being overwhelming. I felt the same way for years. Often the feeling of no way out only perpetuates the debt cycle.
I had a friend who worked as a debt collector for a while. He wasn’t too fond of the job. As much as it would suck to be the one being contacted, it’s not that much fun being the one contacting either.
DC @ Young Adult Money recently posted..Save Money: 5 Sources of Free Entertainment
I can only imagine. As much as we like to vilify them, I’m sure these collectors are not bad people. As John S said below, it probably comes to how many of the companies are led. I’m sure the people working these call centers are under a ton of pressure to collect – probably paid commission.
Taylor @ Repaid.org recently posted..Why I Borrowed From My 401(k)
I wish I would’ve known about the cease & desist letter years ago when I was in credit card debt. The large majority of these callers are just a pain in the a$$ to deal with and will just about anything to get you. Of course, it comes down from how many of the companies are led.
John S @ Frugal Rules recently posted..Working From Home – A Mom’s Perspective
John, you definitely weren’t alone in not knowing about cease & desist. The FDCPA gives consumers a lot of rights, but unfortunately it seems that few people realize it – making them easy prey, of course, for predatory collectors.
Taylor @ Repaid.org recently posted..5 Reasons To Switch To A Credit Union
Great info Jerry. I’ve never experienced this type of situation, but I imagine it can be frustrating and stressful. Thanks for the great info.
Jason Clayton | frugalhabits recently posted..Straight Talk Wireless – Switch and Save Money
Haha! got to love the first one… so true though
Savvy Scot recently posted..5 Energy Saving Gadgets for A New Year
I know, right? It’s so easy not to answer the phone, but it really just makes things worse.
Taylor @ Repaid.org recently posted..6-Month Prep-Plan for Your Loan Application
Ignoring any problem does not make it go away. I hope I never have to deal with this situation, but I’d have to answer to see what was going on.
Kim@Eyesonthedollar recently posted..Options for Diversifying Your Investments
It’s crazy what kind of tactics collectors will use to get you to pay off a debt. In fact I had a brother in-law who was being harassed by collectors who were looking for someone with the same name as his. I told him whatever you do, don’t pay off that debt because if you make even one payment you could now become liable for that debt.
Chris @ Stumble Forward recently posted..How to Manage Your Money Better – 7 Tools to Help
Chris, I’ve definitely heard of mistaken identity being an issue in the collections process. Unfortunately, there is a lot of room for human error when creditors report payments (or lack thereof) to the credit bureaus. How frustrating!
Taylor @ Repaid.org recently posted..Are You Stretching Your Check Too Thin?
Good tips. When I did debt collections for mortgage payments, I would have to tell the borrowers about these tips. I would also let them know that they can send in a letter to the company to only have correspondence in writing, so we would only be able to send them letters to collect the debt. Also, if we contacted the borrower,then we would not be able to talk with them for 3 days. I would tell them to just answer the phone and verify their identity, then hang up. It counted as contact and would allow them to not worry for a couple of days. People loved those tips.
Grayson @ Debt Roundup recently posted..Effective Tips on How to Avoid Getting into Debt
Fantastic tips, Grayson! I love insider tips and tricks like these! Now, did your company require you to tell borrowers these tips, and if so, was it for compliance reasons – or just company policy?
Taylor @ Repaid.org recently posted..Are You Stretching Your Check Too Thin?
Would you have to mail the letter as registered mail to prove they actually received it? It may quickly turn into a he said/she said scenario if they denied ever receiving the letter you sent.
Catherine recently posted..Our Cash Christmas Budget
Exactly, Catherine. You want to have proof that they received it.
Taylor @ Repaid.org recently posted..Overwhelmed By Debt? Debt Relief vs Bankruptcy
The first one made me laugh. Its so true but most people just ignore it. Its also important to know your rights. Collection people can really harass you if you don’t know them.
Debt and the Girl recently posted..Review of 2012 and PF Goals for the Year Ahead
These are good tips; thankful that I haven’t ever been in this situation. But I’ve heard horror stories of people being harassed by debt collectors.
Mackenzie recently posted..One Year Blogiversary! OMG!
Great advice. Back during the year I had no income, these calls were incessant. I needed these tips back then for some really shady calls. One organization in particular wouldn’t get off my back until I sent them written proof I’d paid the loan four times!
AverageJoe recently posted..Stock Market Punishment: The First Lesson of 2013
When I took my last job the person who hold the position before me apparently gave the work number for all her debts. I was harassed every single day. I tried telling them I have no idea what they were talking about but they won’t believe me. Initially I didn’t want to go to the IT people to change my phone because I felt her privacy has already been compromised enough by the collection people and I felt bad doing further damage by telling the IT folks the real reason I wanted to change the phone.
After they someone found out my cell phone and started calling me at home, I decided to sit and educate myself on the collection practices. In the next phone call, I was ready for them to call. I quoted a bunch of law and finally told them if they call me ever again, I will involve my lawyer (it felt good to say that even though I don’t have a lawyer in a retainer). It stopped after months! Good riddance!
Suba recently posted..Tip #1: How to lower your cell phone bill? (Including negotiation scripts)
I JUST sent a certified letter! Some shady company trying to collect money on an account I don’t owe on. They called me on freaking Christmas Eve. Every time it’s for a different amount. And the original company I owe the “debt” to doesn’t have any record of it.
Annoying. But the letter works. The calls have stopped. Just have to keep on top of my credit report now to make sure they don’t mess with it.
femmefrugality recently posted..6 Things That Will Be Cheaper in 2013
Great post. In the UK it is illegal to harass people to collect debt once they are in a debt management program. All the talks of collection have to go through a special bureau. Knowing your rights there is very important.
Pauline recently posted..13 money resolutions for 2013: #4 stop wasting!
Thanks, Pauline – I love hearing how stuff like this is handled in other countries!
Taylor @ Repaid.org recently posted..Why I Borrowed From My 401(k)
Unfortunately, I did have to deal this situation 11 years ago. Incredibly stressful. Your first tip about answering the phone is spot on. You have to deal with the problem. It took me a while to get this but once I did I was able to work with them and negotiate a one-time pay-off. Never again!
Kyle @ Rather-Be-Shopping.com recently posted..Frugal Hack #3: Use Live Chat To Score Deals
I have often told people who owe money to talk to your creditors immediately. If you make arrangements, you avoid a lot of problems.
krantcents recently posted..My 2013 New Year’s Resolutions
I had a school bill accidentally go to pre-collections (mistake by school…awesome, huh?) and despite the school itself confirming my bill was fully paid and this was a mistake, I still received harassing calls from a woman who left a fake name every time she called me.
It finally worked itself out but those few weeks were brutal! I feel for the people who have to deal with this–some of the people making those calls are absolutely horrible.
The Happy Homeowner recently posted..2013 Financial, Personal and Household Goals
Wow, no fun! Were you able to get this deleted from your credit report? That’s always a scary thing when there’s a mistake like this. They say that 80% of credit reports have inaccuracies on them. Crazy!
Taylor @ Repaid.org recently posted..How Are You Going To Save Money in 2013?
Wish my parents had this info when I was growing up. I’m sure they paid more than one scammy company on debts they didn’t owe. I love giving the collectors the finger and busting out the FDCPA and threatening with the FTC reporting. These people are bullies, and it’s nice to know people have tools to help combat them.
Jacob @ iHeartBudgets recently posted..Budgeting Infographic
Clarification: I have not gotten any collection calls ever, but I like the idea of giving them the “proverbial finger” as a society, not me personally.
Don’t feel like you need to explain yourself. We are all for giving people the finger here, regardless of the situation!!!!!!!!!!!!!!!!!!!!!!!!!!!!! =)
I know this might seem off, but I don`t get this normal use of credit card. why use money you don`t have? In Norway, we all have debit cards, i.e. the money we got on that certain card is our real money. Why is this so unusual in North America? Would people really be using that much money, if they were actually using their very money, and not something that got to be paid down sometime down the road. and not to mention interest. I just don`t get it. I do have a Mastercard, but it has a limit, and is only for emergencies. And this is the case for most Norwegians.
The Blonde recently posted..Jetpack 2.1 for WordPress.org
Unfortunately, here in the US we seem to be pretty much addicted to our credit cards. I’m sure everyone from sociologists to economists have their own theories as to why we’re so dependent on credit. But yes, you Norwegians seem to have it right: using a debit card to spend money you have, and not paying so much in interest!
Taylor @ Repaid.org recently posted..Does An Additional $25 A Month Matter To Your Credit Card Debt?
Okey, there was something weird that happened with my last post. For some reason it added another website that I definetely dont write. I`m at blondeonbudget, not blondestudentonbudget. Sorry for the mixup! Please delete it if possible!:-)
The Blonde recently posted..Holiday Recap – Phone version
Very important information. Ignoring the calls doesn’t make the problem go away. Of course, the best path is to never get to the point of calls from collections agencies, but sometimes that does occur.
Thad recently posted..How Eliminating Wheat From Our Diet is Changing My Family
It’s sad when people find themselves in situations wherein collectors are calling constantly. For peace of mind, though, I think these tips are great. Situations where you are having trouble paying back owed money are very stressful, and these calls make it that much worse.