A strong federal law, the Fair Debt Collection Practices Act, protects consumers against certain unfair collection practices. It applies only to outside, or third-party debt collectors (not creditors collecting their own debts) and only for personal (not business) debts. State laws may provide additional protection.
In its 2013 annual report to Congress about debt collection complaints, the Consumer Financial Protection Bureau described collection complaints received by the Federal Trade Commission. In 2012, the FTC received 125,136 complaints about debt collectors — down from 144,451 in 2011. A complaint does not mean a law has been broken, and some complaints may be the result of overseas debt collection scammers who harass consumers.
A collection account can have a major credit score impact. If you’ve been contacted by a collector and are worried your credit is being hurt, you can check two of your credit scores for free on Credit.com.
1. Calling You Repeatedly to Annoy or Harass You
Number of complaints: 37,543
The law: Collectors can’t call repeatedly just to harass you. (However there is no specific number of calls that they can make within a given time period. That’s left up to the courts to decide.) If you think a debt collector is calling too often, start making a record of every time they call and any messages they leave.
2. Trying to Collect More Than You Owe
Number of complaints: 9,034
The law: Debt collectors may be allowed to charge interest on debts they are collecting. But they can’t charge more than the amount described in the original contract or what is permitted by law.
In other words, they can’t illegally inflate debts. But that doesn’t mean some don’t try!
3. Fail to Send a Written Notice of the Debt
Number of complaints: 26,139
The law: Within five days of initially contacting you, the collector must send written notice of the debt that includes:
- The amount of the debt
- The name of the original creditor to whom the debt is owed
- A statement describing your right to dispute the debt
4. Threatening Violence
Number of complaints: 3,312
The law: Debt collectors may not threaten violence when collecting debts. Period.
5. Threatening Dire Consequences
Number of complaints: 30,470
The law: Collectors can’t threaten a lawsuit, criminal prosecution, wage garnishment, jail time, or to ruin your credit rating unless they have the legal authority to do so, and intend to do so. These threats are often illegal. Collectors must usually take you to court first and win before they can take these kinds of actions — if they are legal in the first place.
6. Using Obscene, Profane or Abusive Language
Number of complaints: 13,329
The law: Obscene, profane or abusive language—including racial slurs—is illegal. Debt collector going overboard? Take notes and tell them you’ll be taping the conversation.
7. Calling Before 8 a.m. or After 9 p.m.
Number of complaints: 8,166
The law: Collectors may not call before 8 a.m. or after 9 p.m. (unless you’ve given them permission to do so), or at times you’ve told them are inconvenient.
8. Revealing Debt to Third Parties
Number of complaints: 16,679
The law: Collectors can call third parties such as family, neighbors, friends or co-workers only to locate the debtor. When they do, they can’t reveal the debt and there are limits on repeated calls.
9. Calling You at Work After You’ve Told Them to Stop
Number of complaints: 14,482
The law: If you tell a collector not to call you at work to discuss the debt, those calls must stop. And debt collectors cannot discuss debts with co-workers except in very limited circumstances (when executing a legal wage garnishment, for example).
10. Failing to Verify Disputed Debts
Number of complaints: 9,814
The law: If you dispute a collection account in writing, the collector must stop trying to collect until it provides written verification of the debt.
11. Ignoring Cease Communication Requests
Number of complaints: 4,928
The law: Consumers have the right to tell a debt collector, in writing, to stop contacting them. Once the debt collector gets that notice, contact must stop, except to send notification of legal action against the debt collector.
How to Get Help
If you think a debt collector has broken the law, you can:
- Complain to the CFPB and your state attorney general, and/or
- Contact a consumer law attorney. You may be entitled to damages and/or attorney’s fees.
Whenever you’re dealing with debt, it’s smart to review your credit reports for accuracy, as errors can unnecessarily damage your credit standing. You can learn more about how to dispute credit report errors here.
This post has been updated.