Saturday, February 12, 2011

Readers Question: A Debt Collector Is Threating me if I Don't Pay | What Should I Do?

Some debt collectors use horrific tactics to collect on bad debts. I have heard money guru Dave Ramsey on his radio broadcast relate the stories he has heard over the years of the over the edge tactics debt collectors use. 

Dave Ramsey told of a woman who was being harassed by a debt collector. Somehow the debt collector got out of her that her dog had died. Using this information, threatened her that if she didn't pay he would go and dig the dog up and hang it from a tree. This unnerved the woman so much she paid the debt. She was in such a state that she made several trips to the burial site of the dog to see if he had been dug up. 

This kind of harassment is extreme, yet everyday federal law is being violated by these debt collectors and it goes unpunished. The following list is the from the Fair Debt Collection Practices Act(FDCPA). This is the law that specifys how what practices debt collectors can not do. If they are doing these things you can report them to the FTC and sue them.

What practices are off limits for debt collectors?


  • Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:
  • use threats of violence or harm; 
  • publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies); 
  • use obscene or profane language; or 
  • repeatedly use the phone to annoy someone. 
False statements. 
  • Debt collectors may not lie when they are trying to collect a debt. For example, they may not:
  • falsely claim that they are attorneys or government representatives; 
  • falsely claim that you have committed a crime; 
  • falsely represent that they operate or work for a credit reporting company; 
  • misrepresent the amount you owe; 
  • indicate that papers they send you are legal forms if they aren’t; or 
  • indicate that papers they send to you aren’t legal forms if they are. 
Debt collectors also are prohibited from saying that:

  • you will be arrested if you don’t pay your debt; 
  • they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or 
  • legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action. 
Debt collectors may not:

  • give false credit information about you to anyone, including a credit reporting company; 
  • send you anything that looks like an official document from a court or government agency if it isn’t; or 
  • use a false company name. 
Unfair practices. 
  • Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:
  • try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge; 
  • deposit a post-dated check early; 
  • take or threaten to take your property unless it can be done legally; or 
  • contact you by postcard. 

Do I have any recourse if I think a debt collector has violated the law?

You have the right to sue a collector in a state or federal court within one year from the date the law was violated. If you win, the judge can require the collector to pay you for any damages you can prove you suffered because of the illegal collection practices, like lost wages and medical bills. The judge can require the debt collector to pay you up to $1,000, even if you can’t prove that you suffered actual damages. You also can be reimbursed for your attorney’s fees and court costs. A group of people also may sue a debt collector as part of a class action lawsuit and recover money for damages up to $500,000, or one percent of the collector’s net worth, whichever amount is lower. Even if a debt collector violates the FDCPA in trying to collect a debt, the debt does not go away if you owe it.

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