If you have been unable to keep up with your credit card bills and other debts, you've mostly likely been contacted by your creditor or a debt collector. If demands for payment have left you feeling harried, hassled and helpless, keep in mind that you do have a government agency on your side. The Federal Fair Debt Collection Practices Act (FDCPA) forbids debt collectors from using abusive, deceptive or unfair practices in an attempt to collect personal debts.
Considerations
The Federal Trade Commission says personal debt includes expenses incurred on your own behalf as well as those of your family or for your household. Common examples of personal debt include your mortgage, medical bills, automobile loans and credit card accounts. Debts you may have run up from operating a business are excluded from the act.
Restrictions
A debt collector is not permitted to contact you at inopportune times (prior to 8 a.m. or after 9 p.m.), without your consent. A collector is forbidden to call you at work if he has been previously notified either verbally or in writing that you are not permitted to receive calls while on the job. If you have retained an attorney to represent you about your unpaid bills, the debt collector can no longer contact you and must correspond only through your attorney.
Garnishments
A creditor or its debt collector is generally permitted to sue you in order to collect money owed. If a judge rules in their favor, a judgment will be issued against you. In the case of wage garnishments, your employer will be required to withhold a portion of your earnings to pay your outstanding bills. Federal benefits (Social Security, Veterans) may be exempt from garnishment unless it's to pay delinquent taxes, alimony, child support, or student loans.
Harassment
Debt collectors may not use threats of violence or harm, use obscene or profane language, or continuously use the phone to pester someone. They are also barred from making intimating and false statements such as representing themselves as attorneys or government representatives. Collectors are not supposed to use scare tactics such as claiming that you'll be arrested if you don't pay your debt.
Legal Recourse
If you feel as though your consumer debt rights have been violated, you may sue a collector in a state or federal court within one year from the date the law was allegedly broken. If you win, you may be able to collect damages you can prove you endured (lost wages, medical expenses) because of the wrongful collection practices.
Charge-Offs
When a creditor feels there is no other option but to write off your debt, it may be downgraded to the charge-off category. A charge-off will tarnish your credit report for seven years. Also keep in mind that all is not necessarily forgiven. Sometimes charged-off accounts are sold to collection agencies and the debt collection process can start all over again.
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