Navigating Through Consumer Debt Collection – A Guide For Debtors
January 16, 2010 by Mallory McGuinness-Hickey
Filed under Credit Debt
It begins with the mail. Then more aggressive mail. Then come calls on the telephone and worst of all, threats about credit reports or even a potential lawsuit.
To retrieve debt creditors hire collection agencies. These third party companies generally work on commission which fuels their vigorous attempts to retrieve money.
Collection agencies can actually report your debt to credit bureaus. Unfortunately settling the debt will not result in it being removed from your credit reports, it will only be checked off as “paid.” They also can ask for a debtors credit report to size up the person’s financial situation, or to get an updated phone number and address. And, although collection agencies do not like to send many accounts back, sometimes they will refer their account back to the creditor in order to recommend filing a law suit.
There are rules and regulations by which collection agencies must abide. Letters should come in ambiguous envelops that do not reveal that any type of debt is owed. In terms of phone calls, a collector may not disclose the reason for the call. For example, if a collector reaches an answering machine, they cannot divulge why they are calling, all they can do is leave their name and a number where they can be reached.
Although collection agencies are permitted to contact a debtor’s place of employment, they absolutely cannot get a debtor fired from their job. They are not able to make any kind of information concerning the debt public, although they can communicate openly with credit bureaus. Despite the fact that many people believe that a collection agency could legally seize a debtor’s bank account, paycheck and assets, the company cannot unless their has been a successful law suit ordering them to do so. Under no circumstances can a collection agency threaten a debtor with violence.
Even though some collections companies attempt to practice illegal strategies to get money, there are also a large number of reputable ones. With financial issues like debt, it is always crucial that you know your rights.
For more information, stop by Rapid Recovery Solution where more information can be found.
Max Wood (1)