How to Deal With Debt Collectors: A Brief Guide

Did you know that the average American owes nearly $100,000 in debt? This includes all types of consumer debt, such as mortgages, student loans, and credit cards.

Unfortunately, there may come a day when you need to know how to stop debt collectors from calling. Some people even wonder “can debt collectors arrest me?” The good news is that understanding how to deal with debt collectors is easier than most people think.

Let’s explore everything you need to know to do so safely and effectively.

What Do Debt Collectors Do?

Debt collectors are businesses or individuals that are hired by creditors to collect money owed on behalf of the creditor.

In other words, when you don’t pay your bills, the company you owe money to may hire a debt collector to get the money from you. The debt collector will then contact you and try to get you to pay the debt.

What Are Some Things Debt Collectors Cannot Do?

There are a number of things that debt collectors are not allowed to do when trying to collect a debt. These include:

  • Harassing you or using abusive language
  • Threatening to arrest you or take your property
  • Lying to you about the amount of money you owe
  • Lying to you about their identity
  • Calling you at unreasonable hours
  • Contacting you at work if you have told them not to
  • Sending you written communications that look like they are from a government agency

Be sure that you keep the above information in mind so that you can report them if they infringe upon your rights.

What Should I Do if a Debt Collector Contacts Me?

If a debt collector contacts you, it’s important to know your rights. You should never ignore them, as this will only make the situation worse. The best thing you can do is to request that they only contact you in writing.

This will give you time to gather your thoughts and figure out what to do next. Once you have requested this, they are not allowed to contact you by phone again. If you decide that you do want to speak with the debt collector, be sure to do so in a calm and collected manner.

Remember, they are just doing their job. Be polite and respectful, and try to come up with a payment plan that you can both agree on. If you’re not able to come to an agreement, you can always send a “cease and desist” letter.

This is a formal request for the debt collector to stop all communication with you. Keep in mind, however, that this does not mean that you no longer owe the debt. The creditor can still take legal action against you.

What Are Some Common Mistakes People Make With Debt Collectors?

One of the biggest mistakes people make is to try and negotiate with the debt collector without first understanding their rights. It’s important to know what the debt collector can and cannot do before you even pick up the phone.

Otherwise, you may accidentally give them information that they can use against you. Another mistake people make is to ignore the debt collector altogether. As we mentioned before, this will only make the situation worse.

The debt collector may eventually take legal action against you, which can result in wage garnishment or even seizure of your property. Finally, some people try to use “debt settlement” companies to deal with their debt collectors. These companies will often promise to negotiate with your creditors on your behalf to get a lower payoff amount.

While this may sound like a good idea, it’s important to remember that these companies often charge high fees and are not always successful in getting a lower payoff amount. In many cases, it’s best to just deal with the debt collector directly.

What Should I Do if the Debt Collector Sues Me?

If the debt collector sues you, it’s important to take action immediately. The first thing you should do is file an answer with the court. This is a formal document in which you state your defenses to the lawsuit.

You will then have a chance to present your case in court. If you win, the debt collector will be required to pay your court costs and attorney’s fees. If you lose, the debt collector may be able to garnish your wages or seize your property.

It’s important to note that even if you win in court, this does not mean that you no longer owe the debt. The creditor can still try to collect the debt from you through other means.

You can visit this resource from IVAAdviceOnline to learn more about debt collection.

What if a Debt Collector Contacts Me For a Debt I Do Not Owe?

If a debt collector contacts you for a debt that you do not owe, you can send them a “cease and desist” letter asking them to stop contacting you. You can also file a complaint with the Consumer Financial Protection Bureau. If you think a debt collector has violated your rights, you can sue them in federal or state court.

Understanding How to Deal With Debt Collectors Is Easier Than You Think

By understanding the debt collection process and taking steps to protect yourself, you can avoid many of the common mistakes people make. So, keep the above guidelines in mind about how to deal with debt collectors when moving forward.

Looking for other useful financial information that can help improve your life in the future? Be sure to check out the rest of our blog for similar tips.