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What protections do I have from a debt collector?

The Fair Debt Collection Practices Act, which is enforced by the Federal Trade Commission, protects consumers and limits the behaviors of companies that collect debts. The act applies to individuals who hold a variety of debts, including auto loans, mortgages and credit card accounts, and restricts the actions of persons who regularly collect debts that are owed to others.

According to the act, debt collectors are required to provide a validation notice regarding the outstanding balances. The written notice must be sent within 5 days of the initial contact about the account and must include the name of the creditor and steps to take if a consumer believes that he or she is not liable for the debt. Collectors also face restrictions on where and when they can contact a consumer about an account. For example, attempts to collect funds cannot happen before 8 a.m. or after 9 p.m.

In addition, the FDCPA also provides consumers with protection from creditor harassment. According to the act, a debt collector may not use threats of violence or profane language when attempting to recover payments. Furthermore, collection agencies are not allowed to make false statements regarding the accounts. For example, they cannot suggest they are government representatives, they are not allowed to misconstrue the amount that the consumer might owe and they are barred from suggesting that a consumer has committed a crime when not violation has occurred.

This post is not intended to offer readers legal advice about their rights as consumers, and while these protections give debtors some relief from collection agencies, many overdue or unpaid accounts can be difficult to manage. Another option for seeking relief may be bankruptcy, which can either reorganize or discharge certain debts. In addition, filing for bankruptcy offers consumers additional protection from creditors.

Source: The Federal Trade Commission , "Debt Collection", September 14, 2014

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