Consumer Credit and Debt Collection

You have important rights under the FDCPA for your credit card debt, car loans, medical bills, student loans, mortgage, and other household debts. Business debts are not covered by the FDCPA.

No. The law limits how and when a debt collector can contact you about covered debts. There are also ways to stop a debt collector from contacting you.

Debt collectors

• can’t contact you before 8 a.m. or after 9 p.m., unless you agree to it
• can’t contact you at work if you tell them you’re not allowed to get calls there
• can’t contact you by email or text message if you ask them to stop
• can’t call you more than seven times within a seven-day period or within seven days after talking with you by phone about a particular debt
• can’t privately message you on social media if you ask them to stop

Debt collectors can call you, contact you by private message on social media, or send letters, emails, or text messages to collect a debt.

What does the debt collector have to tell me about the debt?
A collector has to give you “validation information” about the debt either when they first communicate with you or within five days of the first contact. The collector has to include the following:

• their name and mailing address
• the name of the creditor you owe it to
• how much money you owe, written out to include interest, fees, payments, and credits
• what to do if you don’t think it’s your debt
• your debt collection rights, including your right to get information about the original creditor if you ask for it within 30 days of getting validation information from the collector

Mail a letter to the collection company and ask it to stop contacting you. Keep a copy for yourself. Consider sending the letter by certified mail and paying for a “return receipt.” That way, you’ll have a record the collector got it.

Once the collection company gets your letter, it can only contact you to confirm it will stop contacting you in the future or to tell you it plans to take a specific action, like filing a lawsuit. If an attorney is representing you, tell the collector. The collector must communicate with your attorney, not you, unless the attorney doesn’t respond to the collector’s communications within a reasonable time.

But consider talking to the collector at least once, especially if you don’t think you owe the debt or can’t repay it immediately. That way, you might be able to confirm whether it’s really yours or find out more about the amount owed. To avoid debt collection scammers, don’t share your personal or financial information until you’ve gotten validation information or are already familiar with the collector.

Generally, a debt collector can’t discuss your debt with anyone but you or your spouse. If you’ve told the collector an attorney is representing you, the collector must contact the attorney. A collection company can contact other people to find out your address, your home phone number, and where you work, but usually it can’t contact them more than once, and it can never tell them you owe a debt.

Once you get the validation information, if you still don’t recognize a debt, or don’t think the debt is yours, send the debt collector a dispute letter. Say you don’t owe some or all of the money, and ask for verification of the debt.

Make sure to send the dispute letter within 30 days. Once the collection company gets the letter, it must stop trying to collect the debt until it sends you written verification of the debt, like a copy of the original bill for the amount you owe. Consider sending your letter by certified mail and requesting a return receipt to show that the collector got it. Keep a copy of the letter for your records.

If you don’t dispute the debt within 30 days of getting the validation information, the debt collector will assume the debt is legitimate.

Collectors can’t harass you. For example, collectors

• can’t threaten to hurt you
• can’t use obscene or profane language
• can’t call you more than seven times within a seven-day period, or within seven days after talking with you on the phone about a particular debt

Collectors can’t lie. For example, collectors

• can’t tell you that you owe a different amount than what you actually owe
• can’t pretend to be an attorney or from the government
• can’t tell you that you’ll be arrested, or claim they’ll take legal action against you if it’s not true

Collectors can’t treat you unfairly. For example, collectors

• can’t try to collect interest, fees, or other charges on top of the amount you owe, unless the original contract or a law says they can
• can’t deposit a post-dated check early
• can’t publicly reveal your debts, including by sending postcards or putting information on envelopes

Yes. If a debt collector is trying to collect more than one debt from you, the collector must apply any payment you make to the debt you choose. A debt collector can’t apply a payment to a debt you say you don’t owe.

Yes, but a debt collector must take one of the following actions before reporting a debt to a credit reporting company

• talk to you by phone or in person about the debt
• mail a letter or send an electronic communication about the debt, such as a validation notice, and wait for a reasonable amount of time, usually 14 days, in case it’s returned as undeliverable

If a debt collection lawsuit is filed against you, respond by the date specified in the court papers. You are allowed to respond either personally or through your attorney. To preserve your rights, respond and don’t ignore the lawsuit.

Yes, but the collector must first sue you to get a court order — called a garnishment — that says it can take money from your paycheck to pay your debts. A collector also can get a court order to take money from your bank account. Don’t ignore a lawsuit, or you might lose the chance to fight a court order.

Many federal benefits are generally exempt from court-ordered garnishment and states have their own laws about which state benefits can be garnished.

Federal benefits that are generally exempt from garnishment (except to pay delinquent taxes, child/spousal support, or student loans) include

• Social Security benefits
• Supplemental Security Income benefits
• Veterans benefits
• Federal student aid
• Military annuities and survivors’ benefits
• Benefits from the Office of Personnel Management
• Railroad retirement benefits
• Federal emergency disaster assistance

Report any problems you have with a debt collector to

• your state attorney general’s office
• the Federal Trade Commission
• the Consumer Financial Protection Bureau

Many states have their own debt collection laws that are different from federal laws. Your state attorney general’s office can help you determine your rights under your state’s law.

Besides reporting them, you have the option to sue a collector in a state or federal court. You have to file your lawsuit within one year of when the collector broke the law. If you lost wages or had medical bills because of things the debt collector did, you have the option to sue for those damages. If you can’t prove damages, the judge can still award you up to $1,000, plus reimburse you for attorney’s fees and court costs. However, even if a court finds a debt collector violated the FDCPA, you may still owe the debt.