If you receive a call from a debt collector, it means you have an unpaid bill – that has been in arrears for possibly a few months. You are now considered a bad debt, usually after attempts by the company to contact you have been ignored and you have not tried to contact them or make some sort of payment against the debt.
Companies hire debt collection agencies to pursue money that is owed to them. These agencies realize that if you have not paid the bill for several months, even though you have received notices and reminders, you are probably unlikely to respond to them. That is why they tend to use a more aggressive approach when calling debtors. You are not their customer, just a debtor, a label you should try to avoid if at all possible, as it is not an honorable one.
A credit reporting agency will keep tabs on your payment habits and regularity, and often rely on the information they receive from debt collection agencies to do so. It is the main indicator on how responsible you are with money. Car dealers, mortgage companies, and credit card issuers look at credit reports to determine if you will be a good customer – that is, one who pays their bills.
There is very little you can do to avoid debt collectors, as they have various resources at their disposal to track you down, even if you move house. They will even go so far as to call neighbors or your employer to track you down. Yes, it is annoying and can even be humiliating. But that’s their job. They have been hired to collect the money that you owe. Many collection agencies only earn their fee when they have collected money from the debtor, so it is in their interest to do everything possible to find you and convince you to pay the debt. One of the reasons they are so determined to find you is that they only get paid for their services once you have paid off the debt.
The debt collection industry is regulated by Federal rules and guidelines to ensure that your rights are not violated too, despite some disreputable companies’ methods. If you believe that you do not owe money to the original company, you should contact them immediately.You can also try working with the debt collector to work out the confusion. In order to protect your rights, make copies of all communication between the three parties, and keep notes on telephone calls and meetings wherever possible.
One method of debt collection that contravenes the Fair Debt Collection Practices Act is the use of threats to recover the debt. Report any violations to the Better Business Bureau.
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