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Collection Agency Laws: What Debtors Need To Know

Despite laws enforced to prevent consumer rights violation, it’s not unusual for debt collection agencies to cross the line and talk their way into extracting money from debtors. Unfortunately, not all debtors are aware of the Fair Debt Collection Practices Act or FDCPA. To shed light on consumer rights laws, read

One: The Fair Debt Collection Practices Act was passed specifically for consumer debt. This means people with business debt are exempted from this act. Debtors who have business debts do not have the same rights as those with consumer debts.

Two: Debt collection agents are prohibited from calling debtors very early in the morning or beyond 9 in the evening. While the FDCPA did not specify how many times a collector can call up debtors, they are prohibited from threatening or harassing debtors into paying the alleged debt.

Three: Under the FDCPA, debt collectors cannot threaten debtors jail time for unpaid credit card debts. They cannot issue a warrant for arrest because only a court of law can send such warrants. Any debtors who threaten debtors with jail time or arrest warrants are violating the FDCPA.

Four: Collection agencies can file credit card lawsuit against delinquent debtors. However, they cannot use a credit card lawsuit as a threat unless they already acted on it. Debtors need to check if the age of the debt is out of statute. If such is the case, debt collectors can no longer pursue the debt via credit card lawsuit as it is already time barred. Debt collectors who plan to file credit card lawsuit should only

Five: Statute of limitation varies from state to state. Usually, the statutes will range from three to ten years. It’s best to check your state’s statute of limitations for credit card debt to be on the safe side. Once a debt is out of statute, debt collectors can no longer file a credit card lawsuit nor can they collect the money in any other means.

Six: You can stop the credit harassment. If a collection agent is calling you on your home number or in your office, spewing threats and using profane language, or attempt to discuss the debt with a third party, they are violating your rights as a consumer and you can take legal action against such harassment.

Knowing your rights is the first step towards dealing with debt collectors, abusive or otherwise. Most debt collectors assume debtors have no idea about consumer rights and continuously use threats as a way of extracting debt repayments. So know your rights and stand up against abusive debt collection practices.

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