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Five Ways To Defy Debt Collectors

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Debt collectors can be as aggressive as mad dogs. They just won't leave you alone and keep coming back. They may even harass you for debts you don't owe.

You can fight back because you have rights under the federal Fair Debt Collection Practices Act. You don't have to suffer abuse just because you owe money.

Debt collection practices are the top complaint with watchdog agencies like the Consumer Financial Protection Bureau (CFPB). According to Richard Cordray, executive director of the CFPB, who spoke yesterday in Washington:

"Nobody should be surprised that debt collection drives more consumer complaints than any other financial product or service," Cordray said. "Most debt collectors are compensated based on how much they collect, which can create the kind of serious incentive problems that we have noted elsewhere in the financial marketplace.

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And because people have little or no say over who does business with them once the original creditor sells the debt, the risks to consumers are magnified even more. So we have seen that many consumers report being harassed or threatened with illegal actions, such as threats of arrest or jail time."

In a recent survey of consumers, the CFPB found that debt firms are becoming incredibly aggressive in their contacts. For example:

-- "One-in-four consumers said they felt threatened, even though collectors are generally prohibited by law from harassing, oppressing, or abusing consumers. Even more people reported being contacted at highly inconvenient times.

-- About one-third said the creditor or collector had called them most recently between 9 p.m. and 8 a.m. For most people, these contacts violate the law, which says that debt collectors generally cannot call people at times they know or should know are inconvenient unless the consumer specifically agrees to it.

-- Nearly 40 percent of consumers reported that a single debt collector tried to contact them four or more times per week, and 17 percent said they usually were contacted eight or more times per week.

-- Even more told us they asked the collector to stop contacting them, though most said their requests were not honored.

We found that litigation is a common mechanism for collecting debts.

-- In the past year, about one out of every seven consumers who said they were contacted about a debt reported being sued as well – which amounts to many millions of people. But of those who were sued, only one out of four even attended the court hearing.

-- We also learned that more than half of Americans contacted in the past year by debt collectors reported substantial inaccuracies in what they were told about the debt."

What You Can Do

Have you or someone you know been abused by a debt collectors? There are specific rights that you have as a debtor. Here are the rules from the Federal Trade Commission:

1) Debt collectors can't call you at inconvenient times, "unless you agree to it." They can't call you at work, either, if you tell them (orally or in writing) "that you're not allowed to get calls there."

2) You can tell the collector to stop contacting you, but you must do so in writing. If you can easily resolve your debt, talk to them first.

3) A debt collector can't discuss your debt with anyone other than you, your attorney or spouse.

4) "Every collector must send you a written “validation notice” telling you how much money you owe within five days after they first contact you. This notice also must include the name of the creditor to whom you owe the money, and how to proceed if you don’t think you owe the money."

5) The company can't threaten you in any way, use obscene language or state false information about you.

What can you do to get an abusive debt collector off your back? You can report them to your state attorney general or the CFPB. The agency is also drafting new rules to better protect consumers from debt firms.

Remember that you should also get written notice of your debt -- if it's valid -- and should do most of your communication through written documents and letters. If you can prove that you paid off a debt, always send copies of receipts or payments.

You may have to pursue complaints on your own, though, in coming years. Republicans have long sought to scrap the CFPB and President-elect Donald Trump wants to appoint a director who said he wants to dismantle it. In the interim, you still have your rights under the debt collection act. Keep a copy nearby in case you start getting nasty calls.

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