How you should deal with a debt collector depends on whether you owe the debt, do not owe the debt, or are unsure if you owe the debt, your financial situation, and your current and ultimate financial goals.
How to Deal with a Debt Collector if You Owe the Bill
If you know you owe the bill and the amount the debt collector is attempting to collect is correct, what you do next depends on whether you have the money to pay the bill or not.
You Can Afford to Pay the Entire Bill or Make Payments on the Bill
If you can afford to pay the bill in full, simply ask the debt collector what forms of payment are accepted. If the collection agency has a website where you can pay using a credit or debit card that is the best way to make a payment. Using a card will provide you with proof of payment via your statement and allow you to enter the amount of the payment yourself, to help ensure that you are not over or undercharged. If you have a credit card to put the payment on, that will provide you with more protection against the agency double charging you than a debit card would give you. If debit and credit card payments are not accepted, or you do not have a card, the next best option is to mail the collection agency a check. Be sure to include a payment coupon with your payment and/or write your account number on the check. You should never pay a debt collector with a money order if you can avoid doing so; there are just too many things that can go wrong which may result in you losing money and spending unnecessary time resolving the issues.
If you can afford to pay the bill, but not all at once, tell the debt collector how much you can afford to pay each month and ask if that will stop the collection calls. If the agency is agreeable to that, make your payments on time each month to prevent further collection attempts and harm to your credit. Always pay in a way that provides you with a receipt without having to obtain one from the debt collector.
You Cannot Afford to Pay the Entire Bill or Make Payments on the Bill
If you are simply unable to pay the bill or even make payments on it, do not waste your time explaining your situation to the debt collector. The collection agency was hired by the original creditor to collect the debt and cannot reduce or forgive any part of it. You basically have two options; ignore the collection attempts or write the agency a letter forcing them to stop. Which option is best for you depends on your financial goals and future ability to pay the debt. For example, if you anticipate being able to make payments in a couple of months, you might just be able to ignore the calls until you can pay. If you have no intention of paying, are considering filing bankruptcy, or will not be able to pay for quite some time and simply want the calls to stop now, you will need to write the debt collector a letter telling them to stop contacting you. Include your account number and full name in your letter. Be sure to keep a copy of the letter for yourself and mail a copy to the Federal Trade Commission at 6th and Pennsylvania Avenue, NW, Washington, D.C. 20850. Under the Fair Debt Collection Practices Act (FDCPA), the debt collector may contact you only one more time after receiving your letter in order to let you know that they received it and will stop contacting you, as well as to advise you of any other action they intend to take, such as filing a lawsuit against you.
How to Deal with a Debt Collector if You Do Not Owe the Bill
If a debt collector calls you to collect on a bill that you do not owe, how you should deal with them depends on why you believe you do not owe the bill.
You Already Paid the Bill
If you paid the bill in full to the original creditor and the account should not have been turned over to collections or should be removed from collections, you will need to contact the original creditor and discuss this with them. A collection agency is simply hired by a creditor to collect a debt for them. They believe whatever information they are given by the person who hires them and will not waste their time second guessing the creditor or acting as a go-between for you and the creditor. This is because they get paid if they collect the debt, not if they resolve it in any other way.
The Bill is Not Yours
If the bill is a result of identity theft or the debt collector has you confused with someone else, ask them to mail you information about how to report the identity theft or confusion regarding your identity to them and stop them from attempting to collect the debt from you. Complete whatever forms you receive, gather any documentation or information requested and return it to the debt collector. If this does not stop the collection attempts, you may need to consult with a consumer protection attorney to help you enforce your rights.
You Dispute the Original Creditor's Charges
If you do not believe that you owe the bill because you dispute the original creditor's charges, you will need to contact the creditor and discuss this with them. Debt collection agencies are hired by original creditors to collect on the debt they claim you owe them. They have no authority to renegotiate the original contract or settle disputes regarding the contract. If the original creditor refuses to reach a new agreement and reduce the amount you owe or remove the account from collections, you may need to consult with a consumer attorney to help you understand your rights and your options.
Your Insurance Company Should Have Paid the Bill
If you do not owe the debt that a collection agency is attempting to collect from you because your health insurance company should have paid it, you will need to discuss this with your insurance company and healthcare provider. Debt collection agencies do not have the legal authority to speak with your insurance company and have no real interest in helping you resolve the matter with your healthcare provider, as they generally only get paid if they collect money from you, not if they help you get your insurance company to pay it.
The Debt Was Discharged in a Bankruptcy
If a debt collector is attempting to collect a debt that was discharged in bankruptcy, let them know that it was discharged and ask them to send you information about what documentation they need and how to provide it to them. Once you have sent them all of the requested information and documentation, the collection attempts should stop immediately. If they do not, contact a consumer protection attorney to help you enforce your rights and possibly make the debt collector pay you money.
How to Deal with a Debt Collector if You are Unsure if You Owe the Bill
If you are contacted by a debt collector and are unsure if you owe the bill, ask them to provide you with debt validation information. This should come in the mail and include the name of the original creditor, the amount owed, and any contracts or judgments the debt collector may have regarding the debt. Keep in mind that oftentimes debt collectors do not have any documentation of the debt, such as a signed contract, and if after receiving the name of the original creditor and amount owed, you are still unsure if the debt belongs to you, you should contact the creditor to help you determine if you do in fact owe the debt.
If you are being harassed or abused by a creditor or debt collector please contact our office at 1-800-219-3577, for a free, no obligation consultation.