Regardless of how conscientious you may be with your finances, you may still have to face a debt collector at some point. It could be a medical bill that you thought had been paid by the insurance company that ended up in the hands of a collection agency. It could be a case of mistaken identity or a debt that you paid many years ago that a debt collector is attempting to collect for a second time. When you are contacted by a debt collector, be sure to avoid these five common mistakes.
Discussing the Debt Over the Phone
When you answer a call from a debt collector, inform them that you will not discuss the matter over the phone. Once you have informed them that all discussions must be in writing, they must cease contacting you by telephone. Request the name of the person you are speaking to and their title, along with the company name and mailing address. Inform the person on the phone call that you will be sending a certified letter to them requesting verification of the debt. You can explain that the letter will outline what constitutes verification and will have a deadline for when you must receive the information. By law, the debt collector must provide you with the information for you to send you a verification letter. If they refuse, tell them that they are violating the Fair Debt Collection Practices Act by refusing to provide the information. If they continue to refuse, hang up the phone. Follow the same practice each time they call, and document the dates and times of the call.
Provide Personal Information
Never provide identifying information such as your social security number, address or place of employment to a debt collector over the phone. Many times, the debt collector does not have that information and by supplying it, you have given them the ability to report the debt to credit bureaus or to use it as a way to “validate” a debt that is not yours. When a debt collector attempts to verify your personal information, explain to them that you do not provide such information over the phone and that they will have to send their request in writing. In addition, do not accept a computer printout that simply shows your name, social security number and the amount of the debt. Although this basically is all that is required by the Fair Debt Collection Practices Act, they are not considered valid by courts. Insist on your original, signed contract as the only verification that is acceptable.
Making Payments on Old Debts
Every state has a statute of limitations on debt collection and many debt collectors will use threatening tactics in order to get you to pay the debt even when they can no longer file legal action against you. By submitting a payment, the statute of limitations is reset and a missed payment can open you up to a lawsuit or wage garnishments. If you pay with a check or automatic bank draft, the collection agency also has your account numbers and can remove money from your account without your permission. Although this is an illegal tactic, many unscrupulous agencies still do it. Check the statute of limitation on debt collection in your state before making any payments on debts that are more than two years old.
Not Keeping Good Records
The Federal Trade Commission has a complaint process for those who have been the victims of unscrupulous debt collectors. However, in order to file the complaint, you must keep records of the violations. From the first time you are contacted by a debt collector, keep a phone log of when the calls were made and how often as debt collectors are restricted regarding the times and how often they may contact you. Keep notes that include the name of the person you spoke to and what was said, especially if the collector was abusive, harassing or deceptive. Be sure to keep all written correspondence between you and the debt collector as well.
Ignoring the Calls
As much as you don’t want to deal with a debt collector, ignoring the calls will not make them go away. If nothing else, exercise your right to receive verification of the debt. By ignoring the phone calls, you risk a debt collector filing a lawsuit, even if they are legally blocked from doing so. Although a judge may throw the lawsuit out as the statute of limitations has passed, it will still mean a day off of work and possible attorney fees.
By avoiding these simple mistakes, you may be able to stop the debt collector from calling and possibly avoid paying a debt you don’t owe or is uncollectible. IF you need help getting out of debt contact Rescue One Financial we can help.