Recently on our legal forum a user asked, “I have old debts that I have not paid. Recently debt collectors have started calling me again. I thought I was well past the statute of limitations and I am wondering why I am now receiving calls after all of these years. Can you tell me what I should do to stop the calls and deal with this situation?
Despite certain economic recoveries many Americans are still struggling under crushing debts. In fact, it’s estimated that up to 35% of Americans have debt which has been reported to the credit bureaus.
With this in mind, it’s not unusual for certain companies to buy old debts and attempt to collect the debts using harassing credit collection tactics such as badgering and threats to sue. Why do they do this? Debt collection is big business. Businesses can buy the debts for pennies on the dollar, and if enough unsuspecting consumers repay the debts, they make money.
How do you combat this situation? The best tactic is to understand debt collection laws, to not let the collection agencies intimidate you, and to understand the repayment process.
Steps to deal with old debt
- Stay calm and ask for proof of the old debt.
The first step when dealing with collection agencies is to remain calm. Do not acknowledge the debt or agree to make any payments. Instead, keep the call short, professional, and business like. You can ask the debt collection agency to send you written notice about the debt, tell them you do not acknowledge the debt, and let them know that you will not discuss the debt until you have reviewed the information they have sent.
- Understand your rights.
Laws outlined under the Fair Debt Collection Practices Act do not allow third party debt collectors to engage in certain harassing debt collection activities. Specifically, they can only call after 8 a.m. and before 9 p.m. They cannot harass you with repeated calls, they cannot call you at work if you ask them not to, they cannot talk to a third party about your debts, and they cannot threaten to sue you or garnish your wages unless they actually plan to take legal action.
If the debt collector violates the law under the Fair Debt Collection Practices Act you have the legal right to file a complaint with the Federal Trade Commission or to file a lawsuit against them.
- Review the information about the old debt they send to you.
Finally, after you receive information about the debt from the debt collection agency make sure the debt is really your debt. Did they send you the agreement for the debt? Did they send you information about the account history? If the debt does not seem familiar to you, you can request copies of your credit report and review it.
If the old debt is not your debt, which can occur if there was identity theft or an error, you will need to contact the debt collection agency and dispute the debt. All disputes need to be sent in writing and by certified mail within 30 days of the debt notification. Be sure to include information about why the debt does not belong to you.
Debt collection agencies can be determined and aggressive. It’s up to you to understand the law. In addition to the steps listed above, it is also important to understand the statute of limitations for debt collection and how long a creditor has the right to sue to collect the debt.
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