Going into debt is simply an unpleasant fact of life for millions of Americans. Failure to pay and falling into debt collection is even worse. Fortunately, the Consumer Financial Protection Bureau contains a number of provisions that have been implemented to help. Please be advised that laws vary slightly by state and that creditors who own the debt have more leeway then debt collectors. For example creditors may call you at work where debt collectors are discouraged. Below I have attempted to provide information that can help you navigate the process many have already found themselves.
First, some sobering statistics courtesy of http://www.creditcards.com: Average credit card debt per household with credit card debt: $15,799. As of May 2011, the total revolving debt held by Americans has reached about $793.1 billion; ninety eight percent of this number is comprised of credit card debt. Also, rates of bankruptcy increased alarmingly over the past several years with the rate among 25-34 year olds climbing steadily.
For those who have already fallen behind too far, it is important to recognize that they have rights against abuses of debt collectors. The Fair Debt Collection Practices Act outlines the rights debtors are entitled to in terms of legal and fair treatment by collectors. Some of the most relevant are summarized below. Remember if you are in debt, you should immediately look into your options such as credit counseling or possibly shop for a debt consolidation plan.
Written notice must be provided before attempting to collect debts. This must be sent within thirty days of receiving notice and must include the amount owed, the creditor, and other pertinent information.
Debt collectors may not use threatening or abusive language. In addition, debt collection calls are not permitted before 8am or after 9pm. Also, they are not allowed to call your place of employment. Overall, it is very important to know they must always identify who they are and that the purpose of their call is for the collection of debt.
Debt collectors also may not evoke threats. If insolvency or bankruptcy you are seriously preventing you from paying your debts, collectors may not mention potential consequences. These include threats such as the seizure of your assets or civil court actions.
In addition, make sure that you know exactly the amount that you owe and to whom you owe the money. By extension be sure to be aware of what type of debt you owe. Any written or verbal contact made on behalf of collection agencies must clearly have all of this information. Also be careful to keep track of the correspondence in the event threat you either discharge the debt or come to another agreement.
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