5 Major debt collection laws you must know
If you have not been able to make bill payments for several months, then creditors might sell your accounts to the debt collection agencies. The job of the debt collectors is to collect money from you. These collectors get a commission on the total collected debt. Therefore, they try their best to collect debts from you. They use various tricks in order to collect unpaid debt from you. Most of the collectors use these tricks because they know that debtors are unaware of the debt collection laws prevailing in the country.
Debt collection laws
The 5 debt collection laws that you must know are given below:
- Harassment: Debt collectors are not allowed to harass or abuse consumers while collecting debts. They are also not permitted to threaten consumers. They can’t use any kind of violence while collecting debts. The debt collection laws also forbid them to use obscene languages while dealing with consumers. Also, they can’t threaten to file legal case against you or confiscate your home.
- Call at inappropriate time: The collectors are not to contact you at inappropriate time. According to the laws, the debt collectors are forbidden to call you before 8 am and after 9pm. This is one of the most important debt collection laws you must know.
- False claims: Debt collectors are not allowed to make any kind of false claims while collecting debts from you. They are not permitted to make any kind of false statements. They can’t tell you that you have committed crime offense by failing to pay off the debt. For instance, they can’t state that they are government employees if they are not so. They are also not allowed to misrepresent the total debt amount or send fake legal papers to you.
- Divulge information: The debt collectors are not allowed to divulge your debt information to any third party apart from your lawyer, guardian (in case you are minor), spouse, creditor, lawyer of the creditor and credit bureau.
- Debt validation letter: After 5 days of initial communication, the collector ought to send debt validation letter to you. In the validation letter they need to the mention the total debt amount and the name of your creditor.
Finally, if the collectors violate these debt collection laws, then you have the legal right to file case against them. In case you win the case, the debt collector will be required to pay you for the damages you have suffered due to the illegitimate collection practices. The judge might even order the collectors to pay you around $1,000 for the damages you have endured.
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