Debt Collectors Must Treat You With Dignity And Respect

13
July

The law says that debt collectors must treat you with respect. It doesn’t mean that most debtors are treated well by creditors. Creditors will do whatever it takes to get your money. Collecting money that is owed to them makes perfect sense. However, harassing someone and breaking the law to do so isn’t right. Is there anything you can do about it?

Document Everything

You need to gather up as much evidence of creditor abuse as possible. Your first step is to keep a record of all contact from your creditors. Phone calls, emails and letters should be kept in a file. Do not get rid of this evidence at any time. Any battle that goes to court can last for years. Get a witness to any communication that you have with your creditors. Make sure this person is reliable and credible.

Check Your Credit Report For Accuracy

Make sure you keep any correspondence regarding a debt settlement. Creditors love to tell you that they have accepted your settlement offer. You are later surprised to find that your credit report does not reflect this agreement.

Bankruptcy should cause all your debt balances to reflect a zero balance. However, not all creditors will do this in a timely fashion. Some may not do this at all. Debt collectors may try to collect on an account that should have already been settled by now. This is why hanging on to any document you receive is so critical.

Creditors May Attempt To Charge Off Your Debt

Your creditors may charge off any debt that is not likely to be repaid. This is why you may receive a 1099-C form from your creditor. This informs you that you have a debt that needs to be settled with the IRS. Any debt that is discharged by creditors is considered a forgiven debt to you. Forgiven debt is treated as taxable income by the IRS.

This doesn’t mean your debt has actually been forgiven. Instead, a debt collection company will continually call you. The company will harass you and threaten you until you finally pay the debt. You should understand that the debt may not be collectible if it has been charged off.

Statute of limitations rules also apply. Most states impose time limits for creditors to collect on a debt. This limit is 3-6 years in most states. What this means is that creditors cannot take you to court to collect the debt once this time limit expires.

Take Your Creditors To Court

You have the right to defend yourself from any of the above creditor abuses. Hire a lawyer if you are being harassed by anyone trying to collect a debt. Your creditors cannot talk to your employer or any other third-party regarding your debt. They may not threaten a lawsuit against you unless they actually plan on going to court. Any illegal harassment could result in a monetary judgement in your favor.

The easiest way to stay out of trouble is to pay your bills on time. Always contact your creditors first if you are struggling with your payments. It is easier to work out a payment plan now than to hear your phone ringing off the hook later. Make sure to document any contact with your creditors in case you ever need to bring them to court.

This post was written by

jason – who has written posts on Budget Clowns.
Father of three and married to a lovely women. Always looking for ways to save money, and invest it properly for my children's future.

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