The Rights You Have When You Owe Money

When you borrow money using a loan, a credit card, a payday advance, or a mortgage, you are defined as a “debtor”. We would all be able to pay our debts on time and in full if the world were perfect. Most people with debt will miss a payment at some point in their lives. A collection agency may purchase your debt if your account falls too far behind. When you have accounts in collections, the debt collection agencies are prevented by the Fair Debt Collection Practices Act from treating you badly . It is important to understand the rights and responsibilities that both you and the debt collection agency have.

The collection agency’s responsibilities

There are laws that require debt collection agencies pursuing your debt to treat you fairly. Debt collectors must contact you between 8 am and 9 pm. When your employer informs a debt collector that they cannot contact you at work, they can no longer do so. Debt collectors are prohibited from misrepresenting themselves or the debt you owe. Debt collectors are also not allowed to discuss your debt with any third party - they can only get information about how to contact you.

Your obligations when you owe money

When you owe money, you also have obligations. It is important that you know what money you owe, and to whom. A good place to start is obtaining a copy of your credit report. You are entitled, legally, to one copy of your credit report each year, from each of the three credit reporting agencies. If you are represented by a lawyer, it is your responsibility to inform the collection agencies. Talk with debt collection agencies only in writing, so you have a hard record of all the conversations you have.

Rights of the debt collection agencies

A debt collection agency is paid to help you pay the debt they believe you owe. They have the liberty of calling you during reasonable hours. They have the right to contact your lawyer, if you inform them that you have one. Lastly, the agency does have the right to file a lawsuit if you are unresponsive to their communications.

Liberties you have as a debtor

You are entitled to complete and accurate information about the money you owe. It is your right to know which debt the agency is contacting you about. You also have the right to dispute any debt that an agency is contacting you about. You are legally allowed to dispute any debt you are contacted about - just do so within 30 days. The agency is required to verify the amount they believe you owe, along with the name and address of the original creditor. Falling behind on debt can be a depressing situation. If that happens, taking five minutes to breathe will help you maintain your balance. You have legally entitled rights and responsibilities, as does the debt collection agency that will be pursuing you.