How do I not pay debt collectors?
Make sure you dispute the debt in writing within 30 days of when the debt collector first contacted you. If you do so, the debt collector must stop trying to collect the debt until it can show you verification of the debt.
You can sue the debt collector for violating the FDCPA. If you sue under the FDCPA and win, the debt collector must generally pay your attorney's fees and may also have to pay you damages. If you're having trouble with debt collection, you can submit a complaint with the CFPB.
If you don't pay, the collection agency can sue you to try to collect the debt. If successful, the court may grant them the authority to garnish your wages or bank account or place a lien on your property. You can defend yourself in a debt collection lawsuit or file bankruptcy to stop collection actions.
Not responding to a properly served lawsuit – even if you're unsure whether you owe the debt – can result in the court issuing a judgment against you, which could limit your ability to dispute the debt, even if it's already been paid or you don't owe it.
- Keep a record of all communication with debt collectors.
- Send a Debt Validation Letter and force them to verify your debt.
- Write a cease and desist letter.
- Explain the debt is not legitimate.
- Review your credit reports.
- Explain that you cannot afford to pay.
Debt collectors cannot harass or abuse you. They cannot swear, threaten to illegally harm you or your property, threaten you with illegal actions, or falsely threaten you with actions they do not intend to take. They also cannot make repeated calls over a short period to annoy or harass you.
Even if you owe money, debt collectors aren't allowed to threaten, harass, or publicly shame you. You have the right to order a debt collector to stop contacting you, and they must comply. If there's a mistake, and you really don't owe the debt, you can take steps to remedy the error.
If you refuse to pay a debt collection agency, they may file a lawsuit against you. Debt collection lawsuits are no joke. You can't just ignore them in the hopes that they'll go away. If you receive a Complaint from a debt collector, you must respond within a time frame determined by your jurisdiction.
If the debt is not collected, then the debt collector does not make money. In many cases, although you would think that debt collectors would eventually give up, they are known to be relentless. Debt collectors will push you until they get paid, and use sneaky tactics as well.
If you are struggling with debt and debt collectors, Farmer & Morris Law, PLLC can help. As soon as you use the 11-word phrase “please cease and desist all calls and contact with me immediately” to stop the harassment, call us for a free consultation about what you can do to resolve your debt problems for good.
What not to tell a debt collector?
Don't provide personal or sensitive financial information
Never give out or confirm personal or sensitive financial information – such as your bank account, credit card, or full Social Security number – unless you know the company or person you are talking with is a real debt collector.
In either case, the minimum amount a collection agency will sue you for is usually $1000. It can be less than this amount depending on the written agreements signed when you acquired the debt.
The debt will likely fall off of your credit report after seven years. In some states, the statute of limitations could last longer, so make a note of the start date as soon as you can.
Some will only settle for 75-80% of the total amount; others will settle for as a little as 33%. Looking for a place to set the bar? The American Fair Credit Counsel reports the average settlement amount is 48% of the balance. Again, start low, knowing the debt collector will start high.
- Assemble documentation about the debt.
- Review the debt collection notice from mistakes.
- Dispute the debt by sending a Debt Validation Letter.
- Wait for a response from the debt collection agency.
Most states or jurisdictions have statutes of limitations between three and six years for debts, but some may be longer. This may also vary depending, for instance, on the: Type of debt. State where you live.
You have the right to send what's referred to as a “drop dead letter. '' It's a cease-and-desist motion that will prevent the collector from contacting you again about the debt. Be aware that you still owe the money, and you can be sued for the debt.
Generally, paying the original creditor rather than a debt collector is better. The creditor has more discretion and flexibility in negotiating payment terms with you. And because that company might see you as a former and possibly future customer, it might be more willing to offer you a deal.
A charge-off can lower your credit score by 50 to 150 points and can also look very bad on your credit report. It signals to potential lenders that you could skip out on your debt obligations for extended periods of time.
People hate debt collectors because they are rude and harsh to debtors. They call debtors repeatedly and threaten them for failure to make payments.
Can debt collectors actually do anything?
Yes, debt collectors can take you to court to recover a past-due debt. If you are sued, it's important to respond right away, either personally or via a lawyer.
Yes, but the collector must first sue you to get a court order — called a garnishment — that says it can take money from your paycheck to pay your debts. A collector also can get a court order to take money from your bank account.
A frozen bank account is a sure sign that a creditor or debt collector has obtained a court judgment against you (or your joint account holder, if you have a joint bank account). A creditor or debt collector cannot freeze your bank account unless it has a judgment.
According to Investopedia, collection agencies prefer to sue for amounts more than $1,000. So, if you owe $5,000, a lawsuit is highly possible. Even then, remember that lawsuits are costly and time consuming, which is not appealing to debt collectors.
Can a Debt Collector Collect After 10 Years? In most cases, the statute of limitations for a debt will have passed after 10 years. This means a debt collector may still attempt to pursue it (and you technically do still owe it), but they can't typically take legal action against you.
References
- https://guides.sll.texas.gov/debt-collection/know-your-rights
- https://www.consumerfinance.gov/ask-cfpb/should-i-share-personal-information-with-a-debt-collector-en-2098/
- https://www.solosuit.com/posts/debt-sold-to-collection-agency
- https://wallethub.com/answers/cs/how-to-remove-collections-from-credit-report-without-paying-2140646704/
- https://www.debt.org/credit/collection-agencies/how-to-negotiate/
- https://www.bankrate.com/personal-finance/debt/how-to-pay-off-a-debt-in-collections/
- https://www.solosuit.com/posts/should-you-never-pay-debt-collection-agency
- https://www.nolo.com/legal-encyclopedia/debt-collection-defense-requiring-that-the-collector-document-the-debt.html
- https://www.ftc.gov/legal-library/browse/rules/fair-debt-collection-practices-act-text
- https://www.bankrate.com/personal-finance/credit/how-to-rid-credit-report-of-old-debt/
- https://whlawoffices.com/blog/things-debt-collection-agency-cant-do/
- https://www.moneymanagement.org/blog/can-a-debt-collector-collect-more-than-it-shows-on-my-credit-report
- https://www.incharge.org/debt-relief/credit-counseling/bad-credit/know-your-rights-with-debt-collectors/
- https://www.nerdwallet.com/article/finance/get-collections-off-credit-report
- https://www.businessinsider.com/personal-finance/how-to-remove-collections-from-credit-report
- https://www.incharge.org/debt-relief/debt-settlement/negotiating-with-creditors/
- https://www.solosuit.com/posts/do-debt-collectors-give-up
- https://gocardless.com/guides/posts/debtors-and-creditors/
- https://www.creditninja.com/blog/can-you-have-a-700-credit-score-with-collections/
- https://receivablesinfo.com/2022/03/08/the-main-differences-between-first-and-third-party-collections/
- https://www.consumerfinance.gov/ask-cfpb/what-may-happen-if-i-ignore-or-avoid-a-debt-collector-en-1427/
- https://www.moneymanagement.org/blog/understanding-the-statutes-of-limitations-on-debt
- https://money.usnews.com/credit-cards/articles/will-paying-off-a-collection-amount-improve-your-credit-score
- https://www.ramseysolutions.com/debt/how-to-pay-off-collections
- https://www.fdic.gov/resources/supervision-and-examinations/consumer-compliance-examination-manual/documents/7/vii-3-1.pdf
- https://www.consumerfinance.gov/ask-cfpb/what-laws-limit-what-debt-collectors-can-say-or-do-en-329/
- https://oag.ca.gov/consumers/general/debt-collectors
- https://files.consumerfinance.gov/f/documents/102012_cfpb_fair-debt-collections-practices-act-fdcpa_procedures.pdf
- https://www.debt.org/credit/collection-agencies/collection-agencies-never-pay/
- https://www.credit.com/blog/what-is-609/
- https://homework.study.com/explanation/why-do-people-hate-debt-collectors-aren-t-they-in-the-wrong-for-not-paying.html
- https://time.com/personal-finance/article/what-is-a-charge-off/
- https://www.lexingtonlaw.com/education/does-paying-collections-improve-score
- https://www.peopleslawiowa.org/index.php/research-topics/consumer-law/debtorcreditor-law/what-do-debtor-and-creditor-mean
- https://www.abi.org/feed-item/most-common-violations-of-the-fair-debt-collection-practices-act
- https://www.consumerfinance.gov/ask-cfpb/what-is-harassment-by-a-debt-collector-en-336/
- https://www.experian.com/blogs/ask-experian/can-a-collection-agency-legally-put-their-account-on-my-credit-report/
- https://www.stepchange.org/debt-info/debt-collection/can-debts-be-sold-on.aspx
- https://consumer.ftc.gov/articles/what-do-if-debt-collector-sues-you
- https://www.consumerfinance.gov/ask-cfpb/can-a-debt-collector-still-collect-a-debt-after-ive-disputed-it-en-338/
- https://www.equifax.com/personal/education/debt-management/articles/-/learn/what-can-collection-agencies-do/
- https://www.federalreserve.gov/boarddocs/supmanual/cch/fairdebt.pdf
- https://www.consumerfinance.gov/rules-policy/regulations/1006/34/
- https://www.farmermorris.com/faqs/why-you-should-never-pay-collection-agency/
- https://www.solosuit.com/posts/answer-summons-debt-collection-california
- https://www.creditkarma.com/advice/i/long-collections-credit-report
- https://www.sjconsumerlaw.com/lawsuit-defense/frozen-bank-accounts
- https://www.equifax.com/personal/education/debt-management/articles/-/learn/how-to-bypass-debt-collectors/
- https://consumer.ftc.gov/articles/debt-collection-faqs
- https://www.experian.com/blogs/ask-experian/can-paying-off-collections-raise-your-credit-score/
- https://www.debt.org/credit/collection-agencies/how-to-pay-debt-in-collections/
- https://www.farmermorris.com/faqs/11-word-phrase-to-stop-debt-collectors/
- https://www.solosuit.com/posts/what-collection-agency-owns-your-debt
- https://www.incharge.org/debt-relief/credit-counseling/bad-credit/negotiating-with-debt-collectors/
- https://www.solosuit.com/posts/eleven-word-phrase-stop-debt-collectors
- https://www.solosuit.com/posts/dispute-a-debt-and-win
- https://www.consumerfinance.gov/ask-cfpb/what-information-does-a-debt-collector-have-to-give-me-about-the-debt-en-331/
- https://www.bankrate.com/personal-finance/credit/when-does-old-debt-fall-off-credit-report/
- https://www.nolo.com/legal-encyclopedia/what-are-my-rights-against-a-debt-collector.html
- https://www.investopedia.com/personal-finance/debt-settlement-cheapest-way-get-out-debt/
- https://www.nolo.com/legal-encyclopedia/a-collection-agency-debt-can-i-negotiate-the-original-creditor.html
- https://www.solosuit.com/posts/how-long-respond-debt-validation
- https://www.consumerfinance.gov/ask-cfpb/what-is-an-original-creditor-and-what-is-the-difference-between-an-original-creditor-and-a-debt-collector-en-1387/
- https://www.fullmanfirm.com/2023/01/the-truth-about-debt-validation-requests/
- https://upsolve.org/learn/happens-dont-pay-collection-agency/
- https://www.pacificdebt.com/the-minimum-amount-a-debt-collection-agency-will-sue-you-for
- https://www.investopedia.com/articles/personal-finance/121614/5-things-debt-collectors-are-forbidden-do.asp
- https://www.bankrate.com/personal-finance/debt/reset-old-debt/
- https://www.solosuit.com/posts/pay-original-creditor-or-collection-agency
- https://www.experian.com/blogs/ask-experian/credit-education/improving-credit/how-to-rebuild-credit/
- https://www.lendingtree.com/credit-repair/how-to-remove-collections-from-credit-report/
- https://www.alllaw.com/articles/nolo/bankruptcy/debt-verification.html
- https://www.consumerfinance.gov/ask-cfpb/how-do-i-get-a-debt-collector-to-stop-contacting-me-en-1411/
- https://www.consumerfinance.gov/ask-cfpb/can-debt-collectors-collect-a-debt-thats-several-years-old-en-1423/
- https://www.wftv.com/consumer/clark-howard/heres-how-to-send-a-drop-dead-letter-to-a-collection-agency/796114803/
- https://www.creditkarma.com/personal-loans/i/what-is-creditor
- https://www.nolo.com/legal-encyclopedia/handling-debt-collection-calls-dos-donts.html
- https://upsolve.org/learn/debt-validation-verification-letter/
- https://upsolve.org/learn/should-i-pay-debt-collector-or-original-creditor/
- https://www.solosuit.com/posts/debt-collector-prove-court
- https://www.consumerfinance.gov/ask-cfpb/what-can-i-do-if-a-debt-collector-contacts-me-about-a-debt-i-already-paid-or-dont-think-i-owe-en-1403/
- https://www.experian.com/blogs/ask-experian/how-to-get-debt-collectors-to-stop-contacting-you/
- https://www.investopedia.com/terms/c/creditor.asp
- https://www.usatoday.com/money/blueprint/credit-cards/what-is-pay-for-delete-and-how-does-it-work/
- https://www.credit.com/blog/does-your-old-debt-have-an-expiration-date/
- https://uwaterloo.ca/web-resources/wcms-users/training-and-support/wcms-how-documents/validation-rules
- https://www.credit.com/blog/does-paying-off-collections-improve-credit-score/
- https://www.nolo.com/legal-encyclopedia/negotiating-with-collectors-unsecured-debts.html
