By George Cole
Last week, we outlined your consumer rights protected by the Fair Debt Collection Practices Act (FDCPA). But, knowing your rights is only the beginning. Do you know what to do when a debt collector calls your home or sends you a letter demanding payment?
Debt collectors are like a pack of hungry wolves. Once one picks up your trail, others may follow trying to nip off their own pound of flesh. It’s time to stop being the rabbit hiding under the bush!
Put yourself in a position of power with the communication tips below, and watch those wolves slink away with their tails between their legs.
1. Stay calm and focused
The debt collector will be doing his best to rattle your nerves. He WANTS you upset in hopes you accidently say something that can be taken as acknowledgement of the debt.
If you are too flustered, ask to be called back at another time. Better yet, get HIS name and number and make the call on your terms. Decide where you feel most comfortable and if you want a friend or family member there for support (or to be a witness!).
Your call is almost certainly being recorded. Be VERY CAREFUL with what you say. Do not answer any questions about the debt. If the person on the other end of the line keeps pressing the issue, move quickly on to step #2.
2. Put the collector in the hot seat
Take control of the conversation by asking for consent to record the call. Even if you are bluffing, it will put the caller on his best behavior and head off any possible harassment.
Next, ask for the caller’s name (first and last, including the correct spelling), the name of the company he is calling for, the phone number and address of that company, the name of the original creditor of the debt in question, the date of the original transaction, and the exact amount you are accused of owing.
Start a file with all of this information and a detailed record of all phone calls including the date, time, and person you spoke with.
If the caller will not provide this information, be suspicious of foul play. It may be an attempt at identity theft or credit fraud. If this is the case, move on to step #3.
3. Ask for official verification of the debt
Once you have all the information you need, inform the caller that you are disputing the debt and ask for an official verification letter be sent through the mail. (Even if you already know the debt is yours, tell them you are disputing it. This will give you valuable time to organize your finances and figure out a way to pay what you owe.)
The caller should already have your address. If they ask you to “verify” your address, ask them to read aloud the address they have on file. It’s a bright red flag if they do not already have your address.
If the caller will not provide an address, repeat your request for a verification letter and hang up. According to the Fair Debt Collection Practices Act (FDCPA), the collection agency now has 30 days to provide you with the verification letter and may not contact you again until they do.
If this is a case of attempted fraud or identity theft, they’ll leave you alone. You have proven that you are too savvy for them to victimize.
4. Zip your lips
Once you have requested the verification letter, don’t answer any questions about the debt in question. Remember, the person on the other end of the phone is a trained professional. They will do everything imaginable to trick you in to saying something that will legally tie you to the debt. They probably even have a list of key words and phrases they are trying to lead you on to say so they can get you on tape potentially incriminating yourself.
Politely end the conversation by saying something like, “I will be looking for your verification letter in the mail. Once I receive it, I will contact you. According to the Fair Debt Collection Practices Act you have 30 days to send me your letter and may not call me again until you do.”
Then, just hang up. If they call you again before they send the verification letter, they are in violation of the FDCPA and may completely invalidate their right to collect anything from you.
* If you are first contacted by mail, send a letter in response asking for official verification of the debt in question. Be sure to send the letter by certified mail with a return receipt. This forces the collection agency to sign for the letter, giving you proof of delivery if they ever try to say you did not respond to their communication.
OK, so what next?
IF you determine the debt is validly yours, AND it is not past the statute of limitations, THEN AND ONLY THEN, should you disclose anything about your finances or discuss payment options.
If the debt is still owned by the original creditor, you will likely not have much room for negotiation. However, if the debt has been bought by the collections company, you have more options. Typically, these companies buy debts for pennies on the dollar. If you only pay them one-tenth of the original amount, they will still make a profit. (That’s all they really care about, anyway.)
If the collector knows you are on to his tricks, he will be much more likely to agree to a much lower amount to resolve the debt.
If you know what you’re doing, you can make those big, bad wolves look like puppy dogs!
Stay calm and control the conversation. Use the FDCPA as your guide. See last week’s article for more information about the FDCPA.
If you believe you are a victim of fraud or are being harassed by an aggressive debt collector, call your local police and contact a consumer rights attorney. You can start by looking at the National Association of Consumer Advocates website www.naca.net.
When in doubt… give us a call. National Credit Education Services, 770-952-5168.