How to Protect Yourself from Creditor Harassment

Having past due bills is a common problem for many Americans. Unfortunately for some, unpaid bills are such a problem they receive calls from creditors on a regular basis. Whether you get the occasional call or text about a bill you forgot to pay, or you have mounting debt and an increasing problem dealing with it, there are several things you need to know about what creditors are legally permitted to do to collect the money they are owed.

How Debt Buyers Play a Role in Creditor Harassment

Debt buying is common in the lending industry. It occurs when large companies buy and sell consumer debt.

For instance, say you have a credit card account with a department store. For one reason or another, you’re unable to pay the minimum monthly amount due on the card and the debt becomes past due. As a result, the department store lender cancels your account and you begin receiving notices about your account being in collections.

If the company determines they are unlikely to receive payment from you, it has the option of selling your delinquent debt, usually bundled with several other unpaid debts, to a debt buyer for a portion of what is owed. The department store reasons they are better off getting a portion of the debt than losing out on the entire amount you owe – often these accounts are sold for just pennies on the dollar.

Debt selling and buying is legitimate and legal and is used by a number of businesses – credit card companies, personal loan companies, banks, even hospitals – to ease the financial burden of unpaid debts.

Debt Buyers and Collection Efforts

Once the debt is sold, the debt buyer can begin collection efforts of its own by calling you or filing a lawsuit.

Unfortunately, these debt buying companies sometimes take advantage of consumers and their lack of knowledge concerning debt collection. These companies are notorious for harassing borrowers with unpaid debts and often cross the line into illegal debt collection behavior.

If you are experiencing any of the following, it is illegal:

•    Repeated calls that occur after hours or violate the harassment rule set forth by the Fair Debt Collection Practices Act
•    A collector who does not respond to your dispute of the debt
•    Being misled into consenting to autodialed calls
•    Filing a lawsuit without appropriate documentation
•    Being threatened with a lawsuit for debts on which the statute of limitations has expired

Though it’s illegal to do so, debt collection firms file hundreds of lawsuits every month without proper documentation, knowing the consumer will not respond to the lawsuit and the agency will win its case by default.

Understanding Your Rights

Lawmakers are taking action against debt collectors using illegal collection methods, but cleaning up the industry is slow going. This is why you need to be aware of your rights and protections, and know what to do if you are victimized by a debt collector.

If you are threatened with a lawsuit or a debt collection agency takes any other action against you, it’s important to act fast. To discuss your options or explore the possibility of creating an automatic stay that stops debt collection efforts, contact the law office of Frank J. LaPerch, PC at 845.942.5500.