Collections: Your Rights

Collections calls can be intimidating, stressful, and even embarrassing. But as the consumer you have rights. And understanding those rights may help relieve some of the pressure from the situation.

It can be difficult to negotiate a settlement that satisfies the agency’s demands and your own financial ability. But, it can be done!

Hearing From an Agent

When contacted by a collections agent:

  1. Ask for the name of the agency you are speaking with, as well as the name of the agent specifically.
  2. Ask for: the amount owing; the name of the original creditor to whom you owe money; the date the debt was first incurred; the agency reference number; and original creditor’s account number
  3. Request the agent send you a letter, via email or post, confirming all of the information requested in step 2.

Under no circumstances should you offer any additional information about yourself. Answer only if it meets any of the 3 steps listed above. Do not send money or promise to send any money to settle the account at this time.

If they contact you again before receiving the information you requested, simply inform them not to contact you again until you have the information. And state that you will contact them once you have received the requested information and reviewed it for accuracy.

Once you received the requested information, verify that the agency is legitimate – Google will usually suffice. Once you are satisfied, contact the agency and confirm that the agent you spoke with is in fact an employee. Lastly, confirm the amount you were told you owe is the accurate amount.

Agents: Can’s & Can not’s

Collections agents can not do any of the following:

  • Have you arrested
  • Charge additional fees other than what is owed
  • Harass or threaten you in any way
  • Be profane or intimidating
  • Use incorrect information to attempt to manipulate you into paying immediately
  • Contact friends, family, co-workers or others unless their name appears on the debt as a guarantor or co-signer. Agents can, however contact those people only to confirm your phone number or addresses – physical or email.

Agents can contact your employer but only for the following reasons:

  • To confirm your employment status, title, and business address (they can do this one time only)
  • Your employer guaranteed your debt
  • You have provided permission for the agent to do so
  • There is a court order allowing them to do so

Dispute Your Debt

If you dispute the debt, there are two options:

  1. Contact both Equifax and TransUnion and lodge a dispute. For this you will need to have proof the debt is not yours.
  2. Contact the Agency and lodge a dispute.  If  you choose this route, the Agency will only be able to contact you again by taking you to court

If you know you owe a company and the collections item is reported on your Credit Report, you have a few other options to take matters into your own hands. In part 4 of this series I will guide you through effective methods to ending the collections process and cycle.

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