Legal Debt Collection Tricks: How to Spot and Avoid Them
Most of us have heard horror stories about debt collectors who cross the line when trying to collect a debt. They may use abusive language, make threatening phone calls, or even use physical intimidation. While these tactics are definitely illegal, there are also some legal debt collection tricks that you need to watch out for. Here are some of the most common tricks to look out for and how to protect yourself.
Trick #1: Falsely Threatening Legal Action
One of the most common debt collection tricks is to scare you with threats of legal action. Debt collectors may threaten to sue you, garnish your wages, or even have you arrested if you don't pay up. However, these threats may be bogus, especially if the debt is past the statute of limitations or if the collector doesn't have enough evidence to file a lawsuit.
How to protect yourself: Don't let debt collectors scare you into paying a debt that you may not owe. Ask the collector to send you a written validation notice that details the amount of the debt, the creditor's name, and your right to dispute the debt. Once you have this notice, check your credit report or contact the creditor to confirm the validity of the debt. You may also want to consult with a debt relief attorney if you're unsure about your legal rights.
Trick #2: Harassing You With Frequent Calls
While debt collectors are allowed to contact you for legitimate debt collection purposes, they can't do so in an abusive or harassing manner. For instance, they can't call you multiple times a day, call before 8 a.m. or after 9 p.m., or use obscene language.
How to protect yourself: If debt collectors are calling you too often or at inappropriate times, you can write a cease-and-desist letter asking them to stop contacting you. This won't make the debt go away, but it should stop the harassing phone calls. You may also want to block the collector's number or use a call-blocking app to screen their calls.
Trick #3: Misrepresenting the Debt
Debt collectors are required to provide accurate information about the debt they are collecting. They can't lie or deceive you into paying a debt that you don't owe, or misrepresent the amount you owe.
How to protect yourself: Again, ask the collector to send you a written validation notice that details the amount of the debt, the creditor's name, and your right to dispute the debt. Once you have this notice, review it carefully and compare it to your own records or contact the original creditor to confirm the debt. If there are any discrepancies, dispute them in writing and ask the collector to stop contacting you until the matter is resolved.
Trick #4: Threatening to Damage Your Credit
Debt collectors may threaten to report you to the credit bureaus or damage your credit if you don't pay up. However, they can only report accurate information about your debt to the credit bureaus, and they can't threaten to do so if they don't intend to.
How to protect yourself: The best way to protect your credit is to pay your debts on time and in full. However, if you're unable to do so, you can negotiate a payment plan with the creditor or work with a credit counseling agency. You may also want to dispute any inaccurate information on your credit report and ask the credit bureaus to remove it.
Trick #5: Offering a Settlement That's Too Good to Be True
Finally, debt collectors may try to entice you with a settlement offer that seems too good to be true. For example, they may offer to settle a $10,000 debt for $2,000 if you pay upfront. However, this may not be a fair or reasonable offer, especially if the debt is old or already charged off.
How to protect yourself: Before accepting any settlement offer, do your research and compare it to other debt relief options, such as debt consolidation or bankruptcy. You may also want to consult with a debt relief attorney or financial advisor who can help you evaluate the pros and cons of each option.
In conclusion, these legal debt collection tricks can be difficult to spot, but they're not impossible to avoid. By understanding your rights under the Fair Debt Collection Practices Act and staying informed about the latest debt collection trends, you can protect yourself from abusive debt collectors and make smart financial decisions.