Debt Collections: What consumers need to know
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Debt collector on the line?
Here’s what to do, and how to protect yourself.
If you are late making payments on a loan, a credit card, or other bills, you may be contacted by a debt collector. To collect a debt, they can call and email consumers, but they are restricted from engaging in unfair, unlawful, deceptive, or abusive acts or practices. The more information you have, the more empowered you can be.
Is the call real or a scam?
If a debt collector calls, your first move depends on whether that call is legitimate, or a scam. A legitimate debt collector will be clear about essential information. What’s more, gathering a detailed record about the collector, creditor, amount of debt, and calls you receive can help you build a case if you need to make a claim.
You can verify if things are on the up and up by asking the caller to provide his or her name, the name of the business, street address and phone number, who they are collecting on behalf of, and their professional license number.
If you believe the call is fraudulent, hang up and consider submitting a complaint with DFPI.
RED FLAG ALERTBe suspicious if: the caller threatens you in any way, and especially if he or she asks for your personal financial information. |
RED FLAG ALERT
Be suspicious if: the caller threatens you in any way, and especially if he or she asks for your personal financial information.
It’s legit: Now what?
If the call is from a legitimate debt collection company or agency, make sure you respond as soon as you can. Even if it turns out the call is in error and you do not owe the debt, don’t delay. Otherwise the collector may continue trying to collect the debt, report negative information to credit reporting companies, and even sue you.
Make sure the debt is valid, and that it’s yours
Before paying anything make sure the debt is yours. Check your credit report. Ask relevant questions. If you think the debt collector is in error, dispute it. Debt collectors are obligated to send you something called a “validation notice” within five days of contact you, which tells you the amount you may owe, the name of the creditor, and how to dispute the debt.
Know your options
Once you confirm that a debt is yours, you may be able to negotiate a settlement or repayment plan directly with the debt collector. If you choose to seek credit counseling, do your own research to find the best option for your situation.
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PROTECT YOURSELF FROM FRAUD |
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Resources to help you identify fraud, avoid scams, safeguard personal and financial data, and know your rights. Download your free copy today. |
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What You Can Do
Know Your Rights
It’s illegal for debt collectors to act in unfair, deceptive, or abusive ways. Know your rights as a California consumer.
DO YOUR OWN RESEARCHFind out if a debt collector is licensed or is conducting business while their |
DO YOUR OWN RESEARCH
Find out if a debt collector is licensed or is conducting business while their application is being reviewed. Search here.