Knowledge is Power: How to deal with Collection Agencies
During my practice as a Chapter 7 and Chapter 13 bankruptcy attorney in Phoenix, Arizona, I have met and spoken with many people from Phoenix, Glendale Surprise and beyond, who are at their wits’ end in dealing with debt. Many times, they are brought to this brink by aggressive, and sometimes illegal, collection practices. As a result of such tactics, many people end up making poor decisions that only benefit the debt collector and do nothing to get them out of their financial mess.
Debt collectors are regulated by both federal and state law. Consumers have certain rights that protect them from illegal attempts at collecting debt. Unfortunately, most people are not familiar with these protections, and, as a result, they are taken advantage.
“Knowledge is power,” a quote attributed to Francis Bacon, is very meaningful when it comes to dealing with debt collectors. The time of day and the number of times that you can be called, who may be called, and whether you can be called at work, are Debt Collector actions that are regulated by the Fair Debt Collection Practices Act (“FDCPA”) federal law. Among the many resources available, I recommend the following websites in providing you with guidance and the ability to file a complaint against such debt collectors who are in violation of the law:
- The Federal Trade Commission Money Matters microsite
- The Federal Trade Commission Facts for Consumers
- The Consumer Protection Financial Bureau
It is important to understand that not all collectors are regulated by the FDCPA. Collection agencies and some attorneys are regulated, but the original creditor collecting on it own debt is not (but the original creditor may be subject to state banking regulations. See: The Arizona Department of Financial Institutions
When people in Arizona ask me what to do, I will always ask them to do two things when dealing with a collection agency, first, record their conversations and let the debt collector know that the conversation is being recorded and/or keep good notes of all communications, including, date and time of the call. Second, demand that they send you a written notice of the debt owed. Once that notice is received, I then have my clients send a written request that the debt be validated by the collection agency. The information provided will be invaluable. The validation request will help determine whether the debt is actually owed and will provide you with the name of the original creditor, and when the debt was incurred. It will also help in properly scheduling the debt if you later decide that you need to file a bankruptcy.
If you are having difficulty paying your bills and coming to a fair resolution in dealing with your debts, contact a qualified bankruptcy attorney to go over your rights and options in dealing with debt. My office in Phoenix, Arizona offers free in person or over the phone consultations. You have nothing to lose but your debt.