Debtor Rights When a Collection Agency Sues
The U.S. Fair Debt Collection Practices Act, enacted in 1978, seeks to eradicate abusive and harassing practices of debt collectors and collection agencies and protect the rights of the consumer/debtor. The FDCPA states rules and practices by which collection agencies must operate, consequences to creditors for not abiding by these rules, and the rights of debtors in defending themselves against allegations.
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Communication
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A collection agency cannot communicate with a debtor at a time or place that is inconvenient to the debtor. Collection agencies must assume that the only appropriate times to contact the debtor are between 8 a.m. and 9 p.m.. Additionally, the collection agency cannot communicate with anyone other than the debtor without the express permission of the debtor. Above all else, the collection agency cannot contact a debtor directly if he has legal representation; in that case, the agency must communicate solely with the debtor's attorney instead.
Harassment
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A collection agency cannot harass a debtor in any way. This includes threatening violence or other criminal action that may harm the debtor's physical person, property or reputation; using offensive or crude language; reporting the debtor to anyone other than credit bureaus or the court system; calling a debtor repeatedly (on a daily basis) with the intention of causing annoyance or harassment about a debt; and making telephone calls to a residence without attempting to verify the identity of the debtor.
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Legal Process
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A collection agency must follow a certain process before suing someone for an unpaid debt. Generally, the collection agency must first give the debtor written notice of the debt owed, called a "demand letter." Such notice must include the following: the debt amount, the name and address of the creditor, and at least 30 days for the debtor to respond either by making payment arrangements, paying the debt in full or disputing the debt. Only after those 30 days have expired without written correspondence from the debtor can the collection agency proceed with a lawsuit.
Validation of Debt
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The debtor has the right to dispute the debt in whole or in part. In order to dispute the amount owed, the debtor may put the dispute in writing within the 30-day period allotted by the demand letter, and request validation of the debt. The collection agency must then provide the debtor with all documentation reflecting the amount owed and the debtor's responsibility to pay it, including contracts, payment agreements and copies of unpaid bills. The FDCPA clearly states that the court is not to construe the debtor's failure to dispute the validity of a debt as an admission of liability.
Representation
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Every debtor has the right to representation in a court proceeding. In fact, if you dispute the debt and a collection agency files a lawsuit against you, then the recommendation is that you hire an attorney. However, even if you are unable to do so, it is important that you attend any and all court hearings in regard to the debt allegedly owed. Failure to attend a court hearing will often result in the court immediately granting judgment in favor of the collection agency and against you, making a mark on your credit and leaving you open to collection efforts, such as garnishment of your wages or bank account, or a levy upon physical assets (such as your house or vehicle).
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References
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