The holidays are swiftly approaching, and, while everyone’s generally happy to wait on Santa, there’s one person you surely won’t want calling this time of year: a debt collector. Fortunately, consumers on the receiving end of letters, phone calls, emails or other means of recouping a debt don’t need to let any correspondence ruin their holiday cheer. Here are a few things you can do if you find yourself in this situation.
1. Ask for Written Verification of the Debt
The Fair Debt Collection Practices Act requires a debt collector send you a written notice telling you the amount of money you owe and the name of the creditor within five days of contacting you. Being proactive about requesting this information enables you to verify, for instance, that you are dealing with a legitimate debt collector — and not a scammer — and also confirm that the collector isn’t trying to get you to pay more than you actually owe.
You also have the right to dispute the validity of the debt in question. Doing so can be “a terrific way to make sure there are no games being played in the background,” said Troy Doucet, a consumer attorney in Columbus, Ohio.
2. Know Your Rights
Even if you legitimately owe the debt in question, there are laws regarding how exactly someone can collect on it. For instance, debt collectors can’t call you early in the morning or late at night. They can’t call you repeatedly throughout the day and they can’t call you at work once you ask them not to. Familiarizing yourself with your full protections can help you cut off illegal communications. You can learn more about what collectors can and can’t do in this debt collections crash course.
3. Request a Cease of Communications
FDCPA also permits you to request that a debt collector stop contacting you or contact you only by mail. But “you can’t tell them on the phone to stop,” Doucet said; you’ll have to send them a letter. Once they receive this letter, they have to cease communications unless it’s to tell you they’re taken a specific action (like filing a lawsuit) to recoup the debt. If they go outside of these “a consumer could successfully sue,” Doucet said.
Keep in mind, the cease-and-desist letter won’t make the debt go away and you could face judgment, garnishment or serious damage to your credit score if the issue goes unaddressed. (You can monitor how unpaid collection debts are affecting your credit scores by viewing your free credit report summary each month on Credit.com.) You may want to try to negotiate a payment plan with the collector or consult with a consumer-law attorney to see whether you have a claim or what your best legal recourse may be.
4. Get Ahead of Any Unpaid Obligations
If you have a credit card that’s well past due or a medical bill that’s nearly 90 days late, you may want to contact the creditor before it (or other debts) officially ends up in collections. There is a chance the lender or service provider will be willing to work out a payment plan, waiving some fees or even lowering an interest rate in order to recoup at least some of what you owe.
“Just make sure [you] get it in writing,” Doucet said. You don’t want to “make a payment over the phone and then you get a call from a debt collector” the next week anyway, he said.
More on Managing Debt:
- How to Pay Off Credit Card Debt
- Understanding Your Debt Collection Rights
- Top 10 Debt Collection Rights