Dealing with a Collection Agency: An
Interview with the Attorney General’s Office
From LoveToKnow Creditcards
Dealing with a collection agency can be a stressful situation, but sometimes a creditor has no choice but to employ the use of collectors. If you have ever found yourself in the unfortunate position of dealing with a collection agency then this interview with Noelle Talley, a public information officer for the North Carolina Department of Justice, may shed some light on your rights as a consumer.
Although you may feel relatively helpless when in a situation of having an account in collections you do actually have plenty of rights in this situation. The Fair Debt Collection Practices Act safeguards a debtor’s right to be treated fairly during the collection process. However, the consumer is also always responsible to pay legitimate debt.
Is it better for a consumer to have a consumer credit counseling agency or a consolidation agency handle debt collections?
If a consumer is having trouble covering debts, he or she can contact creditors to try to work out a payment plan. If overwhelmed by debt, a consumer can also set up an appointment with an attorney to discuss legal options.
Of course, the best way to avoid problems with debt collectors is to pay bills on time, and a careful budget can help with that. Credit counseling organizations can help you establish a budget, but it is important to choose the right organization.
In what ways can a collection agency locate and talk to a debtor?
- Debt collectors are allowed to make contact in person, by mail, by telephone and by fax about the debts owed.
- They can contact someone at home between the hours of 8 a.m. - 9 p.m; at work if they do not have a telephone number to reach the debtor during non-working hours; and through people who know the consumer if they are unable to locate the debtor through other means.
What if a consumer doesn’t want to be contacted?
To stop a collection agency from trying to make contact at home or at work, a consumer should put a request in writing.
- Send a letter by certified mail telling the debt collector to cease phone contact both at home and the workplace.
- Be sure to keep a copy of the letter on file.
- Once a collection agency or attorney receives the letter, they may not contact the consumer again except to indicate that a creditor intends to take some specific action on the overdue account.
Consumers should keep in mind that sending such a letter will not make debts disappear. Creditors can still take legal action to collect money that is owed.
What constitutes harassment?
When debt collectors initiate contact, they may not:
- Use profane language.
- Threaten with violence.
- Say someone will be arrested if debts aren’t paid.
- Pretend to be attorneys or government representatives.
- Tell an employer or others about the debts, or pretend that they are making contact for other reasons than debt collection.
How does it affect a consumer's credit report to show debts going into collections?
I would suggest contacting one of the credit reporting agencies for more information on this.
What can working with a credit counselor accomplish?
Consumer credit counselors can help with the following:
- Review a consumer’s spending habits and make suggestions for reducing expenses and prioritizing bills.
- Develop a budget for to help control expenses and live within your means.
- Work out a payment plan with creditors so they’ll stop calling for payment.
- Reduce interest rates, late fees and over the limit fees.
Who should consumers call for credit counseling services?
One reputable source of referrals for non-profit credit counseling agencies is the NFCC. Contact the NFCC at 1-800-388-2227, or check its website for further information or the number of a local agency.
Is bankruptcy a good option?
Our office cannot provide legal advice to individuals or represent individuals in their private legal disputes. However, under new federal bankruptcy laws, all individual debtors who file bankruptcy are required to undergo credit counseling within six months before filing for bankruptcy, as well as complete a financial management instructional course after filing bankruptcy.
Consumers may wish to contact a private attorney to discuss bankruptcy or other legal options.
Dealing with a Collection Agency
You should realize that many consumers wind up in some form of financial trouble at one time or another and you should not allow embarrassment to keep you from being actively involved in your financial recovery. This means that you shouldn’t allow yourself to leave bills unopened or avoid staying in contact with the creditors to whom you owe money. This is not to say that you should allow a collector to harass you, and this situation can unfortunately arise if a collector is too exuberant with his or her job. You certainly do not have to allow yourself to be harassed, and it is important that you know your rights as a consumer so that you do not endure bad behavior from a collector.
Most collectors are simply people who are doing a job, and for this reason you should not allow yourself to take out your frustrations on the person who is calling to collect on a legitimate debt. You will get the best results if you remain cordial and actively attempt to work out a solution that is best for both you and the creditor. Sometimes a miniscule monthly payment is enough to keep the collection agency satisfied as long as you continue to make the payments as promised.
Additional Resources
There are a variety of resources available to learn more about the Fair Debt Collections Act and other laws pertaining to debt collections. The website for the Federal Trade Commission should be one of the first places you look when you are dealing with collection agencies. Laws regarding collections of debt exist to protect you, but if you don't know the laws then you cannot protect yourself.
Also, North Carolina Attorney General Roy Cooper’s office has information on a variety of consumer protection issues. Certain guidelines will vary state-to-state, but reviewing this site will provide consumers with a better understanding of the process in order to ask questions and formulate a plan of action.
Dealing with a collection agency should be a wake up call that now is the time to get your finances under control. Take the time to work out a realistic budget and stop spending more money than you can pay back.
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Comments
George,
It sounds as if MTN-Syria didn't come through with what they promised and that AT&T is holding you to your original AT&T contract. Once you change the SIM card you were getting MTN-Syria local phone service AND you still had AT&T coverage. If you didn't get anything in writing from AT&T when you made the switch to MTN-Syria, I'm afraid that you may not be able to get AT&T to further reduce you bill.
Thanks for taking the time to share your story.
-- Contributed by: SusanWeberTo whom it may concern:
I would like to introduce myself, my name is George Nadour, and this is my story about an outrages phone bill I received by AT&T phone company when I came from visiting my family overseas after 3 years of separation.
The story begins when I went to Syria on vacation on July 13th 2008,Soon after my arrival I went to a phone company , named ( MTN- Syria) and I asked them is there any way I can use my (I phone) as a local phone without being charged for rooming by AT&T since many of my friends did the same thing before. Indeed, they unlock my phone and switch my SIM card to local one and MTN Syria sign has appeared on my screen. I was charged total of 300$ for 600 minutes. I did ask them if I need to call AT&T to confirm it, but they assured me that my cell phone works as a local phone and there is nothing to worry about. What made me feel confident that each time I dial a number I hear their greeting before the conversation. Also I was told when I run out of minutes, I just can dial 1818 number and buy as much minutes as I want. Therefore, I start using the phone and in my mind it’s now a local phone. Unfortunately, I had a tragedy in my family and I used the phone more than usual. When I arrived to U.S on Aug 29th 2008, I was shocked to found out that my phone bill was $ 3645.21 ‘I almost had heart attack and who does not?’ Immediately I contacted AT&T customer service to ask for an explanation and I could not get a straight answer. They kept transferring me to a different department every time and each time a different person. Every call I spent more than 30 minutes trying to explain to them what happened exactly while I was overseas. Finally, after many attempts they did reduce the bill to $1959.06. Despite this reduction, the amount was still extremely high and with my limited budget as a student who is on financial aid and without a permanent job, I tried to contact them again and see if they can reduce the bill furthermore, but without any positive response. Meanwhile my wife canceled her line and I was charged 175$ along with the monthly charges of my cell phone despite the fact my line was disconnected. So now I have in addition to the previous pill another 260$ added on, to bring the balance to a total of 2301 $.
By the way I told them how come AT&T suspended my phone line on July 31th 2008 and I still using the phone without any trouble, usually when the line is suspended you can’t dial, received, text from your phone while me I did, I said it doesn’t make any sense to me could you explain that to me. They said well that impossible to happen. Well either I got deceive over there in Syria or I am getting deceive over here by AT&T because until now it doesn’t make any sense so far about cutting the phone line so I cannot use it, but I did still use it with MTN Syria network. The last time I was talking to them they said we can’t give any more credit back for this bill, you have to pay for this bill or you know the consequence from not paying the bill. I told them first of all, I am a student and I am under financial aid for my school, I live with my brother and I am not working, I can’t afford it and there no way I will pay for something I got deceived for it. After I did call them today Oct, 7th 2008 and I told them I want to cancel my service with you guys because I don’t see any more help from you anymore and I am also getting charge for monthly service without using the line, they said we can’t cancel this service right now and we can’t give you a confirmation number we have to wait until Nov 4th 2008 for the end of billing date. I think they are going to add a cancellation fee and new monthly service to my account which is I don’t know how much it is going to be. I never ever have this issue with another company like that and I always pay my bills on time and I don’t have late payment on any of my credit card. I hope you can understand the whole situation and trying to help me resolve the issues.
If you need any further information, please don’t hesitate to contact me at [phone number deleted]. I will be willing to provide you with any do...entation will help you to solve my case.Thank you and have a nice day. [name deleted].
Any help guys.. thanks
-- Contributed by: GeorgeInes,
If you are not able to pay the full amount that you owe, you should send the collection agency a letter and set up a payment schedule. Tell them how much you will pay each week. You can also tell them in the letter to not contact you by phone. Keep a copy of the letter for your files and send the letter by certified mail so that you will receive a receipt from the post office showing when the letter was delivered. They will try and insist that you pay the entire amount, but hold your ground and tell them you that this is the only way you can pay off the debt. Even if you can only pay a little a week, the collection agency would rather receive a consistent payment, even if it is a small amount of money. Make your payments by check sent by certified mail so that you have proof that you are making the payments. Or, you can arrange to have your bank transfer a specific amount of money out of your account each week and send it to the collection agency. The key is to communicate with the collection agency in writing, set up a payment schedule, make the payments on time and have record of what you agreed to do and to show that you made the payments.
-- Contributed by: SusanWeber
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