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Collections Agencies and Creditors: You Have Rights!

By Erik Folgate

I have recently been in the process of paying a bogus collection solely because I want to buy a condo soon.  The collection was from a tow truck company that charged me for impounding a vehicle that still had the title in my name.  Get this, I junked a car a few years ago (or so I thought).  This car was an old mercury cougar that would have been more money to fix than what it was worth.  The mechanic told my dad that if we sign over the title to him that he would take care of salvaging it for us.  Well, apparently he fixed the car and resold it to someone who didn’t have a license or a registration for the car.  They were arrested and when they went to go look for a name to charge for the impounding, they found my name.  Obviously, I was very upset, but it would have probabl taken me years to fight this off of my credit report.  So, I am giving in and paying it like a sissy, because I would rather own this condo.  Anyway, it has helped me to learn my right as a consumer when it comes to dealing with these not so pleasant people.  I was not sure of all the horrible things I had heard about collectors and creditors until I had to deal with them on a regular basis.  They are the scum of the earth!  I am sorry to say it, but I don’t know how they sleep at night.  All I wanted to do was talk to them about the situation, but they would keep hanging up on me.  It’s ridiculous, anyway, as far as them being professional, I never had a problem with that.  They never tried to harass me or else I would have had a lawyer on their butts faster than you can say lawsuit.  Here are some things to remember when dealing with a collection or past due account on your credit report.

  1. First, make sure you are looking at your credit report at least once a year to make sure everything is accurate.
  2. Collectors are only supposed to call you between the hours of 8am and 9pm.
  3. Collectors are not supposed to call you at work if you request them not to do so.
  4. If a collector ever starts harassing you with threats to sue you, put you in jail, garnish your wages, get you fired from your job, or anything else like that, immediately terminate the call and send them a letter stating that they must cease all communication with you at once.  These people will get anything to guilt you or scare you into paying your collections.
  5. You can always negotiate.  They are never going to accept negotiations at first, but depending on the situation, you have the power to work out different situations other than paying the amount in full.  Unless you are in my case where I could not close on the property until the account was paid.
  6. You are only obligated to verify your address and where you work.  You do not have to answer any of their crazy personal questions that they will ask you.  Collectors will try to get as much information out of you about your financial situation so that they have a better picture of whether or not you can pay the collection.  Never give them any information that they are NOT entitled to. 

If you would like to read more about these rights visit the website for the Fair Debt Collections Practices Act.  Remember that if you owe the money, then you owe the money!  Don’t try to get yourself out of it unless the collection truly is inaccurate.  However, you have to look out for yourself.  You cannot pay a collection before you pay the rent, utility, or grocery bill.  These people do not care about these life situations, and they will try to get you to pay them before you pay for a roof over your head!  Protect yourself first. 

Erik Folgate
Erik and his wife, Lindzee, live in Orlando, Florida with a baby boy on the way. Erik works as an account manager for a marketing company, and considers counseling friends, family and the readers of Money Crashers his personal ministry to others. Erik became passionate about personal finance and helping others make wise financial decisions after racking up over $20k in credit card and student loan debt within the first two years of college.

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  • Sue

    This is interesting. Wish I knew more of this 5 years ago.
    I missed a payment on our mobile home the month after my Mother passed away. I was very busy as well as emotional and simply missed it. After the 3rd week I started getting phone calls. I told them my situation and would check my files and my bank account to confirm what they were telling me. Sure enough I had missed it. So I mailed it. For the next 5 days I got numerous phone calls. They were evil. They demanded payment by phone and stated they would rip up my check if it arrived in the mail. I was told they were calling the entire debt on the home due now. I was called a horrible mother, and even threatened that they would take legal action. I refused to make the payment by phone because they were calling me and I had not even gotten a late notice in the mail. I recorded every persons name , date and time they called and notes on what was said. Finally the last person who called I stated that I would be recording the conversation….he hung up. The next day after that there was a torn paper at my door with the name and number to call someone regarding this debt. Mind you I was not even 30 days past due. My husband then got involved and was told they had not gotten the check. He payed by phone. The very next day not only did that phone payment clear our bank…so did the check I sent. I was furious. My husband thought since I was so upset that I was exaggerating the story. He called our account manager (second time during this) and notified them of what occurred. She stated that it was the only complaint they had gotten and it was an outside company they hired to do this. I am going to assume they have been let go! I wish I had even more information as to how to handle these types of calls. I have never had that happen before..never since. What scared me the most is that these people (3 total) were so scary over the phone, and then one was at my door when only my children were home. Thank goodness they never answered the door! I have never trusted this company since this event.

    • Erik Folgate

      Yeah, unfortunately this stuff happens all the time. Collections agents are very emotional abusive, and they’ll say anything to get someone to pay right away.

      It’s always important to remember that you must pay for your priorities first, and old debts second. You must put food on the table and lights on first, then pay debt.

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