Frequently Asked Questions (FAQs)
A list of the most commonly asked questions concerning debt collectors can be found below. Please contact a Fair Debt Collection Lawyer for more information or by completing the form on this page.
Don’t let a debt collector intimidate you because you don’t know or understand your rights under Fair Debt Collection Laws, read the questions and learn about your consumer rights.
What must a debt collector tell me?
A debt collector may contact you initially by telephone. If they do, they are required to send you a written notice within five days telling you the amount of the debt you owe, the name of the creditor that you owe the money to, and what action you should take if you do not owe the money.
Can a debt collector or collection agency contact
my employer?
A debt collector can only contact your employer to verify your employment and to attempt to locate you, not to discuss anything about the nature of the debt itself. If a debt collector disclosed information about the debt to your employer, this violates the third party contract rule in the FDCPA (Fair Debt Collection Practices Act).
Can a debt collector contact me at work?
If you request that the debt collector not contact you at work after an initial call or if your employer does not allow this type of call at work, you have informed the collector of this and they continue to call, that is a Fair Debt Law violation contact an attorney now.
Can a debt collector contact my friends, family
and neighbors?
A debt collector may contact a friend, neighbor or family member ONE TIME to ascertain your address, phone number or place of employment to assist in locating you, however this is limited to that one time only and if they calls continue, or any personal information concerning you or your debt is divulged to the 3rd party, it is illegal under the FDCPA.
One of the intentions behind the FDCPA was to offer protection where privacy is concerned, by limiting debt collector communications about your personal affairs to third parties. Fair Debt Collection Law does recognize that there is a need for some limited third party contact by debt collectors to locate the consumer in question, however that is the extent of communication that is deemed “necessary” and nothing beyond that.
Can a collection agency or debt collector inflate the amount of the original debt by adding interest or penalties?
The law says the following about debts and interest when a legal judgment doesn’t exist.
Section 808(1) prohibits debt collectors from collecting any amount unless the amount is expressly authorized by the agreement creating the debt or is permitted by law.
For purposes of this section, "amount" includes not only the debt, but also any incidental charges, such as collection [53 Fed. Reg. 50108] charges, interest, service charges, late fees, and bad check handling charges.
808(2) Legality of charges. A debt collector may attempt to collect a fee or charge in addition to the debt if either:
(a) the charge is expressly provided for in the contract creating the debt and the charge is not prohibited by state law, or
(b) the contract is silent but the charge is otherwise expressly permitted by state law.
Conversely, a debt collector may not collect an additional amount if either:
(a) state law expressly prohibits collection of the amount or
(b) the contract does not provide for collection of the amount and state law is silent.
808(3). If state law permits collection of reasonable fees, the reasonableness (and consequential legality) of these fees is determined by state law.
808(4). A debt collector may establish an "agreement" without a written contract. For example, he may collect a service charge on a dishonored check based on a posted sign on the merchant's premises allowing such a charge, if he can demonstrate that the consumer knew of the charge.
What is a “charged off debt” and is it still collectable?
A charged off debt is a debt that is no longer of value to the creditor as he or she has assumed it is “uncollectible”. Junk Debt Buyers, or Third Party Collection agencies who buy these accounts from the creditor, now technically own the accounts and thus can collect on the debt.
Collectors still can attempt to try and collect on old debts even if they have expired under the statutes of limitations laws.
Can collectors freeze or take out the funds in my bank account?
In most cases, and unfortunately, yes. If you owe a creditor or collector money, they can, if they’ve obtained a judgment against you under garnishments laws, have the money in your bank account frozen or go after the funds that are in the account.
An experienced, Fair Debt Attorney can best advise you on how to proceed if this is your situation, contact an attorney in your state for a free evaluation.
Please review the State Garnishment Laws for your state and the Federal Wage Garnishment Law for more information on what a debt collector can do.
What constitutes abusive or illegal tactics, what can’t a debt collector
say to me?
Threatening to have you arrested or jailed, take your SSI or other protected income, threatening to take your household furniture, threatening to cause physical injury to you or your property, threatening to send false information about you to the credit reporting agencies are not allowed under the FDCPA.
Additionally, using obscene or profane language, misrepresenting the character, amount, or legal status of the debt, making empty threats to scare you, pretending to work for a credit reporting agency, pretending to work for a government agency, falsely claiming to be an attorney or to work with attorneys sending you fake legal papers to confuse you, or telling you to ignore real legal papers, additionally are prohibited by the Fair Debt Collection Practices Act.
Is there anything I can do to get a debt collector to stop calling me
right away?
If you write a letter requesting that a debt collector stop all future phone calls to you they must stop. This does not mean, however, that you do not have to pay the debt or that you don’t still owe the money.
Contact a fair debt collections attorney for a free consultation.
Do I have any protection when a creditor is trying to collect from me?
Though the federal Fair Debt Collection Practices Act (FDCPA) does not apply to the collection department of a creditor (it only applies to outside collection agencies). However, many states have fair debt collection laws that do cover creditors' collection departments
What is the “Mini-Miranda and how does it protect my rights?
The Fair Debt Collection Practices Act provides that a debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of debt. Section 807 of the FDCPA provides that "false, deceptive, or misleading representation" includes the failure to disclose in the initial oral or written communication with the consumer that "the debt collector is attempting to collect a debt and that any information obtained will be used for that purpose", and the failure to disclose in subsequent communications that "the communication is from a debt collector". This is referred to as the "mini-Miranda" requirement, as modified effective December 30, 1996. Summons, complaints or other court documents are now excluded and do not require the "mini-Miranda" warning on each such document.
What if I can't pay the past due amount a collector is demanding?
Before a debt collector can get a court judgment against you, they will attempt to collect payment(s) from you by calling and sending you threatening collection letters. If you don’t pay, the collector will probably sue you. If and when the collector (or creditor) does sue and obtains a judgment against you, you can expect they will use more aggressive collections actions:
- If you have are employed, the collector will attempt to garnish up to 25% of your net wages.
- The debt collector also may attempt to seize any bank deposits or other deposit accounts you have.
- If you do own property (real estate), the collector may record a lien, which will have to be paid if and when you sell or refinance your property.
Some collection agencies practice the tactic of agreeing to settle with you for far less than you owe and then turning around and hiring another collection agency to collect the difference. This practice is illegal in certain states. Once a creditor deposits or cashes a full payment check, even if a creditor scratches out the words "paid in full," or writes "I don't agree" on the check, he or she can't come after you for the balance. The states in which this law is enforced include:
| Arkansas |
Colorado |
Connecticut |
Georgia |
| Kansas |
Louisiana |
Maine |
Michigan |
| Nebraska |
New Jersey |
North Carolina |
Oregon |
| Pennsylvania |
Texas |
Utah |
Vermont |
| Virginia |
Washington |
Wyoming |
|
Some states have modified this rule. In the following states, if a creditor cashes a full payment check and explicitly retains his right to sue you by writing "under protest or without prejudice" with his endorsement, then he can come after you for the balance. But those exact words must be used. If he writes "without recourse," communicates with you separately, notifies you verbally, or writes on the check that it is partial payment, it is not enough.
| Alabama |
Delaware |
Massachusetts |
Minnesota |
| Missouri |
New Hampshire |
New York |
Ohio |
| Rhode Island |
South Carolina |
South Dakota |
West Virginia |
| Wisconsin |
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