One great fear many people have is the threat of creditor harassment. As a bankruptcy attorney, one of the first questions people want me to answer is what to do when a creditor calls them asking for payment.
A creditor calling you to demand that you pay a debt can be upsetting. But you being upset does not make the call harassing! People often want to take legal action to stop harassing calls but when asked to describe the harassment, the answer is often just that it is a call from a creditor or that there are too many calls. Simply calling someone who owes a debt and demanding that they pay is not, by itself harassment under the law. If you haven’t got the emotional strength to deal with calls from your creditors, you are going to see yourself as a victim over and over. “A coward dies a thousand deaths" will end up being your motto. Who wants to live like this?
If you don’t owe the debt, it may be harassment. If the creditor contacts family, friends, and your employer, it may be harassment. But it is not harassment just because a creditor calls you. Harassment is something that is “over the top" in what is legal and professional business conduct. It may include calling you in the middle of the night, threatening criminal action in order to collect a civil debt, or even threats of violence. It may include false claims to be a representative of the government, falsely claiming to be an attorney or with the credit bureau. Harassment can include calling without identifying who the caller is.
Don’t dish it out if you can’t take it! Many people react to a debt collector’s call by cursing and yelling at the caller, and then pretend to be horrified that the caller curses and yells back. Once you establish a hostile tone to your conversation with a debt collector, don’t demand that the debt collector treat you with courtesy. Oh, and by the way, debt collectors almost always record their conversations with you, so if it comes to a court case involving a claim of creditor harassment, expect any foul mouthed or angry language from you to be played in court. You can’t throw the first punch and expect to be treated with respect. And you can’t use profane language and sue a debt collector for responding with profanity. Laws to protect you from telephone calls from creditors usually apply to only to debt collectors that are not directly employed by the creditor.
Federal laws such as the Fair Debt Collection Practices Act (found at http://www.ftc.gov/os/statutes/fdcpa/fdcpact.shtm (http://www.ftc.gov/os/statutes/fdcpa/fdcpact.shtm)) and the Telephone Consumer Protection Act (found at www.transition.fcc.gov/cgb/policy/TCPA-Rules.pdf (http://www.transition.fcc.gov/cgb/policy/TCPA-Rules.pdf)) mostly regulate the actions of debt collection companies, not the original creditor. So if you have a payday loan, the collector that works directly for the Payday lender does NOT have to comply with the same laws the XYZ Collection Agency must obey. Because of this important distinction, when speaking with someone who is trying to collect a debt, always find out if the caller is an employee of the creditor or works for an independent debt collection company.
Accept that your personal problems are your problem, not your creditor’s problems! If you have personal problems, your creditors have no obligation to be sympathetic or offer you any accommodation. Whether you have medical issues, are going through a divorce, have lost your job. or have any other type of personal problems, it is not a legal defense to a debt collector taking action against you. You might as well retain your privacy as to tell a debt collector about your problems! Debt collectors aren’t obligated to care about you.
Debt collectors are sometimes regulated by state law as well as by federal law. In Nevada, problems with a debt collection companies can be handled by the State Financial Institutions. Many other states also have divisions that will investigate consumer complaints involving debt collectors. But if your state does not have such an organization, the Federal Trade Commission also investigates complaints about illegal collection agency actions. Debt collectors use illegal collection practices only because they work and because they believe that few consumers will follow through by making a complaint in writing to the authorities. Don’t let them get away with it!
You have the right to tell the debt collector not to call you again at work, at home or on your cell phone. If you chose to make this request, be sure to send the debt collector a letter repeating your demand in writing, and send the letter by certified mail to the collector. Since the debt collector does have the right to contact you in some way or another about the debt, you will wish to provide a method by which the debt collector can contact you, such as contacting you in writing at your home address. If you ignore a debt collector, they have the right to use the legal system to collect the money you owe. That means that by not accepting telephone calls from a debt collector, you may be giving them little choice but to file a lawsuit against you. By the time legal fees and interest are added on to the amount of the original debt, in some instances, it is not a surprise if the size of the debt doubles once a lawsuit is filed with the court.
If you refuse to answer your door when a process server comes to deliver legal papers, you are playing with fire. You may get burned when a court issues a judgment against you and you only find out about it when your bank account is frozen or your wages are garnished. Face reality! If your debts are overwhelming and if you are unable to pay even a small portion of your debts, you may need to make a painful decision to use the law to end creditor harassment by filing bankruptcy.
Bankruptcy offers programs to allow someone to eliminate their debts based on the person’s unique and individual circumstances. Someone that can’t afford to pay anything can get their debts eliminated, while someone who can afford to pay part, but not all of their debt, can enter into a debt settlement program monitored by a federal Trustee. Part of the process of bankruptcy includes complete protection from any contact by the creditor to try to collect the debt.
Santa Claus is a mythical figure! Any steps you take to solve your debt problems, other than paying the creditors 100% of what you owe them, will involve a negative repercussion. Both bankruptcy and debt settlement will damage your credit, and anyone that suggests otherwise is lying to you. You do have rights to stop creditor harassment and you don’t have to talk to a debt collector if you don’t want to. But enforcing your rights is not simple or easy. And if you need to bring in a lawyer, it isn’t cheap either. Debt collectors know they can get away with a lot before they will have to face any repercussions. Reporting genuine harassment to the authorities is one way those who have been victimized by creditor harassment can help each other. And it costs you absolutely nothing to report your experience to the authorities.
Although being in debt and not being able to afford to pay is never something anyone wants to face, you can use the experience of facing hard times to learn what is important to you. For too long, our culture has accepted money as if it was our God, and we relied on money to solve our problems and to protect us. If money has turned on you, reassessing your values may make this hard time the most important time of your life.