WHEN IN DEBT KNOW YOUR RIGHTS
As consumers we are required to pay our bills or debts as required under the contracts we sign. There are times, however, that despite our best intentions to honor our obligations, changed personal circumstances make that very difficult. Medical emergencies, family responsibilities or changes as well as a loss of employment may lead to problems in paying one or more of our bills for a period of time. The continued non-payment may result in a consumer being contacted by a debt collector. The focus of this guidance is to inform a consumer of their rights when unpaid bills go into collection. These rights also apply when an error occurs in the debt collection process such as you are not the debtor or you have already paid the debt.
IF YOU ARE CONTACTED BY A DEBT COLLECTOR:
- Dispute the debt or any part of it by notifying the debt collector in writing within thirty days of being contacted by telephone or mail.
RESULT: The debt collector must then obtain verification of the debt or the court judgment and mail it to you. The debt collector must also cease all collection activity until the information is mailed to you.
- Notify the debt collector in writing to cease contacting you in any way.
RESULT: The debt collector must stop communicating with you except to notify you it has stopped or that the company you owe may initiate other remedies available to it, such as hiring an attorney. The debt however, will remain outstanding.
- Request in writing or orally that the debt collector not contact you at work.
RESULT: The debt collector can not communicate with you at work about the debt. An oral request however is only valid for ten days unless followed up in writing.
- Specify to which debt any payment is to be made if you have multiple debts.
RESULT: The debt collector must apply any payment in accordance with your directions.
- Request verification of a disputed debt as above.
- Create a paper trail by keeping a record of the date, time and name of the individual contacting you and putting all of your requests and responses in writing.
- Attend any scheduled court proceeding including Small Claims Court so you do not lose by default.
- Plan to repay any undisputed obligation and determine a payment plan you can maintain and provide that to the debt collector in writing.
A DEBT COLLECTOR MUST:
- Tell you the amount of the debt and the name of the creditor to whom it is owed at the initial communication or within five days of the contact.
- Disclose in the initial communication that they are attempting to collect a debt and that any information obtained will be used for that purpose.
- Disclose the name of the debt collection company and the name of the individual collector making the contact.
- Inform you of the name and address of the original creditor if you request that information in writing within thirty days of the initial contact.
- Communicate directly with your attorney if you have one and the debt collector is provided with that information.
- Notify you in writing within thirty days of the initial contact of your right to not have collection telephone calls made to your place of work.
A DEBT COLLECTOR CAN:
- Assume a debt is valid if it is not disputed within thirty days of contacting the consumer.
- Contact any person, including family and friends, for the sole purpose or acquiring information or where you live or how to contact you.
- Call you at home and come to your residence during normal working hours which are from 8:00 A.M. to 9:00 P.M., but only twice in any seven day period.
- Collect expenses in excess of the amount owed, such as fees or interest, if such charges are expressly authorized by the agreement or permitted by law.
A DEBT COLLECTOR CAN NOT:
- Discuss your debt with third parties, such as family or friends without your direct prior consent or judicial authority.
- Represent or imply they are affiliated with the federal government or any state or distribute any document which simulates or falsely represents that it is authorized by any court or government agency.
- Represent or imply that documents are part of a legal process or that they are an attorney.
- Use or threat to use violence or criminal means to cause physical harm, or harm to your reputation or property.
MASSACHUSETTS LAW AND REGULATION:
The Division of Banks (Division) licenses and examines debt collectors employed by creditors to collect outstanding obligations from Massachusetts residents. Debt buyers, entities that purchase debt in default, also require a license by the Division to collect debt from Massachusetts residents. If you need further clarification or information regarding your rights when dealing with debt collectors, you may call the Division's Consumer Assistance Unit at (800) 495-2265 extension 1501. The relevant statute and regulations governing debt collectors can be found at Massachusetts General Laws chapter 93, sections 24 through 28 and 209 CMR 18.00.
The Division's website at www.mass.gov/dob has additional information on frequently asked questions concerning debt collectors. The Federal Trade Commission also provides information on the Fair Debt Collection Practices Act, the federal law governing the collection of debt.