Right next to Time Warner Cable, debt collectors are one of the most complained about businesses (although nothing can be as bad as Time Warner Cable). They are famous for their sometimes-shady tactics to collect debts from consumers. Most collectors get away with these practices because consumers are not aware of the tactics they are (and are not) allowed to use when reaching out to you.
Here at Veeto, we want to help inform you of your debt collection rights and what you should do if one of your accounts has been mistakenly marked for collection.
Note, however, that we are not your attorney, and you should therefore not construe anything written here as legal advice. Our attorney made us say that--what a bore :)
How Does Debt Collection Work?
If you have a delinquent, unpaid debt from a company (perhaps arising from a time when you used their service, for example, but did not pay them for it), the company might accept this debt as a loss and sell it to a collection agency instead of itself continuing to ask you to pay. It is really a question of probability, and every company has its own way of calculating the probability that you would ever pay if they continued to pester; and at some point, that probability analysis tells the company that it would be more cost-effective for the company to reach out to a third party than to continue spending its own money/resources trying to reach out to you. In this situation, the collection agency acts as a third-party that takes the time to annoy you to get the money back.
Remember Jessica from high school who never paid back that $5 she owed you? Pretend you got another friend to annoy her for that $5 instead. Although, we don’t think Jessica would want to be your friend after this.
Or maybe you were the friend who never paid someone back. Paul claims you owe him money. But instead of asking you himself, he asks Peter to pester you. And if Peter gets you to pay, Paul pays Peter a cut (of pickled peppers).
How They Can Affect Your Credit Score
A debt collector must give you notice before they can take any action against your credit report. If you continuously dodge their letters and calls though, they may be able to take action against your account eventually.
It goes without saying, you don’t want debt collection on your credit report. Your credit score will drop (significantly if you have a good credit score) and the debt collection can stay on your account up to seven years. This can affect your ability to take out loans in the future.
So here is an important general rule: anytime a collector contacts you in an attempt to collect a debt, respond immediately to say that you do not owe the debt. Doing so outs the collector on notice and often requires them to do a little extra work to make sure that they have their facts straight before continuing to attempt collection. This is one task Veeto is designed to help with, since we are good at generating and delivering legally binding dispute letters.
The Fair Debt Collection Practices Act (FDCPA)
The FDCPA is intended as a legal protection for consumers and dictates how collection agencies may reach out to you. Under the FDCPA, Debt collectors can contact you in the following ways:
- They can call your home phone and cell phone.
- They can call your work phone (although they can’t contact you at work if your employer doesn’t approve of those calls. You’d have to tell them this though).
- They can call your friends and neighbors to confirm they have the correct contact information. (They can’t reveal they are trying to collect debt from you).
- They can call you multiples times a day, but cannot call you back-to-back because that is harassment.
- They can show up at your home (which is surprisingly legal).
- They can notify you via mail about your payment notices.
- If they can’t find you, they may just list the collection on your credit report.
How They Cannot Contact You
- They cannot call you before 8am or after 9pm.
- They cannot harass, oppress, or abuse you (they can’t threaten violence, damage your reputation, or property).
- They can’t say you’ve committed a crime by not paying the alleged debt, because this is false.
- They can’t lie about who they are (such as concealing their identity).
However, each year debt collectors prove they don’t always follow the law. So what can you do instead?
Use Your Veeto Power
At Veeto, we’ve helped clients whose rights we’re violated under the FDCPA or were mistakenly targeted for debt collection. In fact, we helped one of our clients save $5,326 when he was mistakenly targeted for debt collection. With our automation technology, we can help you...
- Craft a legal demand letter that matches your complaint data;
- Send the letter to the collection agency and make sure your complaints are heard.
With Veeto, you have the power to fight back on any low-value claim. Let us help you next!