Debt collectors probably have the worst job ever. Have you ever asked a six-year-old what they want to be when they grow up? Have you ever heard the answer “debt collector”? Rule of thumb: unless a six-year-old aspires to be whatever you currently are, your job sucks.
But this isn’t about six-year-olds. This is about debt collectors. People love to hate them. Actually, people genuinely hate them. Debt collectors are the nice people who call you when you haven’t paid your bills, usually for a long period of time. Some of them are super nice and just trying to do their jobs. Others are bitter or get a weird thrill out of bringing you misery — these are the ones that harass you and call you in the middle of the night.
The latter may try to trick you into giving them information or bully you into making payments that will prevent you from paying your essential bills — rent, utilities, food, etc. But don’t be fooled! Let’s talk about the things that debt collectors don’t want you to know.
1. You actually do have rights. The Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Billing Act (FCBA) are regulations for debt collectors — what they can and cannot do. Some debt collectors ignore these, but if you familiarize yourself with your rights, you can gently remind them. If they don’t listen, you can always report them for unlawful behavior. Suck on that, jerky debt collectors!
Related: 6 Steps to Get Out of Debt
Most of the “secrets” I am outlining come from these two acts which make up the Consumer Credit Protection Act (CCPA). This stuff is legit, don’t be bullied just because you are overdue and scared.
2. You are not required to answer questions about your personal information. Do not give debt collectors your personal information — including your SSN, bank account numbers, or place of employment. If they say it is necessary, they are lying to you. It is 100% not required.
3. In fact, you are not required to answer ANY questions. Want to hear something awesome? You really don’t have to talk to debt collectors if you don’t want to. There is NO LAW requiring you to talk to them about anything at all. On top of that, if you send them a cease and desist letter, it is illegal for them to harass you with further calls and letters. Doing so will violate the aforementioned FDCPA.
4. You do not have to make a large down payment on the amount owed. Should you decide to talk to debt collectors, understand that you are not required to put a large sum down to start settling your debt. Most people don’t know that a lot of debt collection agencies actually work on commission. Just like salespeople might try to push you into purchases, debt collectors may try to convince you that a large down payment is necessary. It’s not — don’t fall for that!
5. Debt collectors cannot enforce due dates on you. While some collectors might try to convince you that nonpayment by a certain date will result in severe punishment, this is not true. First of all, what is severe punishment? They aren’t going to kill your family, they might just yell at you more.
Second of all, your payments are already late. They can’t tell you when to pay your past due bills. They will try to speed up this process because the longer you take to pay back the amount owed, the less likely it will be paid back in full. There are no deadlines. Relax.
Also, threats by collection agencies are illegal under the FDCPA. If you are threatened, report it.
6. They can’t screw up your credit any more than it already is. Guess what, guys? Your credit is screwed up. That’s what happens when you don’t pay your bills and they go to a collection agency. Boohoo, hopefully this wakeup call will help you repair it quickly.
Debt collectors may try to convince you that they will screw it up more. Like doubly screw up your credit. This is false, it is just a simple scare tactic.
Related: 5 Debt Traps and How to Avoid Them
7. You have options when it comes to student loan debt. As I’m sure many of you know, student loans cannot be discharged in bankruptcy (at least, ALMOST never). Your brain and degree cannot be repo’ed, so you have to pay up. Thankfully, you have some options here.
By law, you are able to set up a payment schedule with the collection agency requiring only “reasonable and affordable payments” in line with your current financial situation. Also, if you make nine out of ten of these payments on time, the debt will be taken out of the collection agency and sent back to the Department of Education (DoE). Why is this good? Well, the DoE will not harass you and it is not looking for commission. Your loan(s) will be held under more favorable conditions with the DoE than it was with the collection agency.
8. They can’t take all of your money. Debt collectors may try to scare you with threats of wage garnishment and it is true that SOME of your wages can be garnished. However, social security and pensions cannot be garnished, nor can 75% of your salary. While 25% of your salary can be garnished, you can file a claim of exemption if the garnishment would cause your family hardship (like not being able to eat or keep your lights on).
Debt collectors can be scary and some of them can be bullies. Know your rights so you are not taken advantage of. And thank your lucky stars that you aren’t a collector. What a crappy job, amiright?
Have you ever had to deal with a collector? Did you get lucky enough to deal with a nice one (aka the unicorn of all debt collectors)?