Debt collection actions can be anxiety-inducing, potentially to the point of impacting someone’s daily life. As if the idea of being behind on debt isn’t bad enough, borrowers sometimes have to contend with aggressive collection tactics. These tactics are particularly common among businesses and other operations that purchase debt from the original creditors.
The Fair Debt Collection Practices Act (FDCPA) and other laws forbid abusive collection behaviors. Borrowers have a right to dictate when, where, and how they are being contacted. It is illegal to threaten the borrower with inaccurate information about criminal laws or supposed pending lawsuits.
You can also order collectors to direct all contacts to your attorney and not yourself. If you are facing harassment and want professional legal assistance, do not hesitate to reach out to our Albuquerque-based firm New Mexico Financial & Family Law. We provide confidential consultations where you can learn about your rights as well as some options for resolving debt that may be at your disposal. Call (505) 503-1637 or contact us online to schedule a consultation today.
Know Your Rights When Dealing With Abusive Creditors
People who work in collections get paid when they get borrowers to pay their bills, so they can be very creative in their tactics. They understand that they have not just psychological but also emotional manipulation at their disposal. Calling repeatedly, issuing threats, and contacting you against your will can all have the effect of “wearing down” some individuals.
The only flaw in abusive collection tactics is that, in most cases, these types of actions are illegal. The Fair Debt Collection Practices Act (FDCPA) offers protections for:
- How you are contacted
- When you are contacted
- Not being contacted at work after a request.
- Honesty and transparency in the debts owed their amount, and the creditor holding them.
- Information about the original creditor, including their name and address
- Ceasing contact or directing contact to your attorney, upon request
- The right to dispute a debt and to be notified of this right
The Right to Dispute Debt
Most of these rights above don’t typically affect the amount of debt you owe but know that you also have the right to dispute a debt. Collectors are supposed to inform you of this right upon initial contact or by sending a written notice that mentions this right within five days of their first contact date.
Sometimes, companies have errors in their records regarding the amount owed, what has been paid, the agreed-upon interest and payment terms, and whether certain fees would be waived or extensions would be allowed. Proving you have debt can be as easy as the company pulling up old records, but if you have information in writing that clearly contradicts their records, then you may be able to clear the dispute. Working with an experienced attorney can allow you to be thorough in your documentation and effective when it comes to disputing or negotiating debt.
Once a creditor has received notice that you intend to dispute the debt, they are not allowed to contact you for the purposes of collecting the debt until the collector or the original creditor can verify the amount owed with respect to your dispute.
What Debts Are Protected Under the FDCPA?
Unfortunately, not all debts are included in the protections afforded by the FDCPA. However, most forms of consumer and personal debt are covered. This includes mortgages, credit cards, medical debts, and potentially other debts if they are related to “personal, family or household purposes.”
Business debts are excluded from these categories, encompassing debts owed to vendors as well as financial lenders.
Also, the FDCPA only technically applies to debts owned by “debt collectors,” which include debt collection agencies, individuals who buy debt, and some attorneys. The original holder of the debt may be barred from abusive practices by other laws. Generally, the pushiest techniques are reserved for use by companies and individuals who specialize in debt collections.
Dictating Time and Place of Contact
The FDCPA issues general guidance that collectors cannot call you before 8 a.m. in the morning or after 9 p.m. at night unless you’ve specifically told them you would prefer contact at these times. If you are technically not allowed to receive communications related to personal matters like debt collection at work, the collector is forbidden from contacting you there, as well.
You can also request for all contact to cease. Once the collector has received notice that you do not want further contact, they are only allowed to respond in order to confirm that there will be no contact or to take specific legally sanctioned actions regarding notice of things like a lawsuit. They cannot interpret this to mean idle threats about lawsuits, either. You can only receive service of process or other official means of contact on an as-needed basis, not continually.
Note that requesting the collector to cease contact does not bar them from continuing their efforts to collect the debts. They may be able to obtain a court order to garnish your wages or seize some of your property if they are successful in litigation. For this reason, it is only advisable to request the total cessation of contact if you intend to either pay off the debt or exert your own rights with the assistance of an experienced financial law attorney.
Gathering Information About the Debt
Debt collectors cannot hide information from you regarding the debt you supposedly have to pay. They must disclose the exact amount owed. Preferably, this amount is divided into the principal balance, interest, fees, and other items so that you can understand exactly how the accounting adds up.
You can also request more information about the origination of the debt. They must disclose their business/organization name to you as a creditor, and they must reveal the name and address of the original creditor they purchased the debt from.
Protection From Harassment and Abuse
The FDCPA issues broad protections regarding harassing and abusive practices on the part of debt collectors. Under these protections, the following practices are not allowed:
- Threatening harm, harm to reputation, or other criminal activities as a means of intimidation
- Using obscene or graphic language that is abusive to the person hearing or reading the message
- Publishing a list of people with outstanding debts, except to furnish to a consumer reporting agency or another approved agency
- Publicly advertising the sale of your debt as a means of coercion.
- Repeatedly calling or contacting in an attempt to annoy, abuse, or harass.
- Refusing to identify themselves during a phone call, except in instances where they are allowed to do so while obtaining contact information
- Using a postcard to notify you about the debt
- Causing you to accumulate communications charges by misrepresenting the nature of the communications, such as by placing a collect call or C.O.D. telegram
Protection From False or Misleading Representations
Debt collectors are forbidden from misleading you, misrepresenting themselves, or making false statements. This can encompass the following situations:
- Pretending to be a U.S. or state employee or directly affiliated with either
- Misrepresenting the nature of the debt or their role in collecting it, including what compensation they may receive for their collection
- Pretending to be an attorney when they or not or pretending communications are from an attorney when they are not
- Threatening to take legal action that is legally unable to or that they have no intention of actually taking
- Lying about criminal consequences of nonpayment, including imprisonment, property seizure, wage garnishment, or the forceful sale of property
- Falsely claiming that the debt holder has committed a crime when they have not.
- Communicating or threatening to communicate false information, which includes not declaring that debt is currently disputed
- Sending misleading documents that look like official court, legal, or U.S./state government agency documents
- Attempting to conceal a legal document and disguise it as a non-legal one, including by implying that the form does not require action by the debtor
- Lying about selling accounts
- Disguising the true name of the collection agency or their employer
Honoring Requests to Postdate Checks or Split Payments Between Multiple Debts
When the debt holder requests that a check is postdated — meaning it should not be deposited until the requested time — then the creditor must honor that request. To protect the creditor, they must not accept a check postdated by more than five days unless they then notify the sender that they intend to deposit the check. This notice must be sent within three days of the deposit date but not more than ten days before it.
Collectors also may not request a postdated check with the intention to use the check to later intimidate the debt holder or to use the check for aiding criminal prosecutions.
Protection From Illegal Property Seizure
In many cases, a creditor or even a collector may have the legal right to disable or repossess the property in connection with the debt. However, if the creditor has no enforceable right to seize the property, repossess it, or disable it, then it is illegal to do so or to threaten to do so.
Protections From Illegal Debt Increases
Under the FDCPA, a collector may not “collect any interest, fee, charge, or expense incidental to the principal obligation unless it was authorized by the original debt agreement or is otherwise permitted by law.”
Civil Liability for Violating Consumer Protections
If a debt collector is harassing you, it may not affect any obligations you have regarding the debt, but you can pursue civil action to restrict further abuses and potentially obtain damages you have suffered. Do not threaten legal action to any collector directly. Instead, write down the date and time, and nature of the unwanted, harassing, abusive, or threatening contact. Then, reach out to an attorney to learn your options for pursuing a case to hold the collector accountable for their violations.
The Right to Appoint an Attorney and Direct Communications to Them
If you so wish, you can request that all communications regarding your debt or collection be directed to your attorney instead of yourself. Your attorney will not only relieve you of the burden of handling communications, but they can also keep a record of each interaction to aid you in a possible civil action, debt settlement negotiations, or bankruptcy proceedings.
Do I Need to File Bankruptcy to Stop Creditor Harassment?
There are very few legal means to force creditors to stop contacting you except in the case of temporary forbearance or relief. Bankruptcy is the only way to completely and totally cut off all communications from creditors, and it affords the opportunity to reorganize and pay down debts at the same time.
When a bankruptcy petition is filed, the court will grant an “automatic stay,” meaning all collection actions must cease. Creditors are forbidden from contacting you directly, although they can bring intended actions to your attention or voice their concerns to the court.
Bankruptcy is not for everyone, and you shouldn’t be bullied into bankruptcy just because of abusive creditors. But if you are concerned about your ability to repay debt, bankruptcy could be a better choice than letting unpaid debt — and the associated worry — grow.
Speak with an experienced financial law attorney to examine your options for dealing with harassing creditors, asserting your rights, and finding ways to manage your debt once and for all. You may be able to work out installment agreements, renegotiate debt terms, or come to a lump sum settlement agreement to trade debt reduction for immediate payment.
Reach out to Experienced New Mexico Financial Lawyers for Assistance With Creditor Harassment
New Mexico Financial & Family Law has decades of experience helping Albuquerque consumers like you. Our central goal is to make you aware of all your rights and your options for moving forward. We never want to pressure you towards any one choice, so you will be given the full amount of information needed to make the appropriate decision for your situation.
Contact us today, you may be entitled to a free consultation for those with consumer and personal debts when you call (505) 503-1637 or contact us online.
We are a debt relief agency and have practiced bankruptcy law for a combined 50 years. Our services include helping individuals and couples file for bankruptcy relief under the Bankruptcy Code.