Unfair Debt Collection Practices

Debt collection term actually has a neutral meaning. It is a normal transaction when lenders try to collect loan repayments from borrowers. However, if you're a debtor who is finding it difficult to pay off your debt the collection term may mean bad things to your life.

Dealing with a debt collector can be one of your life's most stressful experiences. They might call you at any time using many collection techniques that oftentimes harass you or invade your privacy. Some consumers reported that they even embarrass them by contacting employers or neighbors for a debt that are not rightfully theirs.

If you have been treated unfairly by collection agencies recently it's the best time to learn about ways to protect yourself from any abusive collection practices.
 

How Collection Process works

If you're contacted by a debt collector it usually means that your creditor has not received debt payment from you for several months. The collector can come from another company or from an in-house collection function.

A third party debt collector buys your bad debt off your creditor for less. A collector may also work for your creditor for a fee or a percentage of the amount of money that they recover from you. It is in their best interest to recover as much money as possible and many of them will resort to all sorts of aggressive tactics to extract funds from you -- whether you can afford it or not.

If you are expecting a debt collector, know your rights and don't allow them to bully you into making a payment that you can't afford. Even though no one likes to deal with debt collectors, sometimes doing so can be beneficial. It certainly doesn't hurt to try. You might be surprised at how willing they are to help.
 

Dealing with a Debt Collector

When a debt collector calls, tell them about your circumstances. No matter what reasons you have letting them know that there is something keeping you from paying them is important. They will be much more willing to work with you that way.

Once you've explained your situation, listen to what they have to say, and if it sounds doable, accept. However, if they don't offer a solution, ask if there is any way that your interest, payments, or fees can be lowered.

If the person you speak with does not have the authority to extend the assistance you need, ask to speak to a supervisor. Explain your situation with the supervisor and tell him or her what you should do to get your payments current.

What if they won't help? If this happens to you, try to work something out with other creditors so that you can afford to make payments to everyone. If that doesn't work, talk to a credit counselor, which has the experience necessary to work out deals with creditors that consumers may not be able to.
 

Debt Collection Statute of Limitations

There is a chance that a debt collector contacts you for an old debt you don't even remember. In this case you need to understand the statute of limitations of the debt. If it passes the statute of limitations it is legally called uncollectible and can't be enforced in a court of law.

Generally the time period a debt can be collected is from 3 to 7 years. However, as the time period for the statute of limitations varies with type of debt and the state you need to find the exact time period in the state you reside.

If you're called and pressured by a collector to pay an old debt then demand proof of legality of the debt from the agency. The agency has to give you information about the debt within 30 days. If they fail to do so they have no charge on you. Also, remember to contact credit bureaus to remove the debt from your credit report, if it is over 7 years old.



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