Fair Debt Collection Practices Act Demand Letter Guide

Under federal law, you have a number of protections against collecting agencies bothering you. A simple demand letter based on the Fair Debt Collection Practices Act can show them you’re serious.

The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from threatening nonpayment with arrest or incarceration. It also prohibits harassing phone calls at all hours of the day or night. Several states impose extra restrictions on debt collectors that the FDCPA may not cover.

Debt collectors are not allowed to intimidate you, your property, or your reputation. The FDCPA prohibits debt collectors from using profanity or making false statements.

With a Fair Debt Collection Practices Act demand letter, we can help you stop harassing collection calls.

Block Debt Collector Calls

To stop debt collectors from calling you, you must write a letter to the collection agency. Under the FDCPA, you will request that they stop contacting you immediately.

The notice issued under the Fair Debt Collection Practices Act will prevent debt collectors from calling you at home or at work.

Fair Debt Collection Practices Act Letter Sample

For the debt collector, here is a sample fair debt collection language demand letter.

TO DEBT XYZ COLLECTOR: CEASE AND DESIST LETTER – WITH DISPUTE OVER DEBT (Demand for Validation)
Your Name
Your Address
City, State, Zip
Date:

Name of the Collection Agency
Address
City, State, Zip
Re: Acct #XXXXX

Whom It May Concern:
This letter will serve as your legal notice under the federal Fair Debt Collection Practices Act (FDCPA), to cease all communication with me regarding the debt referenced above. Do not contact me, or any third parties regarding this debt as of this notice.

Moreover, I formally dispute the validity of this debt. Please provide me with documentation that supports why you believe this debt belongs to me, and why you believe I owe the stated amount. Please send me original copies of the application for this account, any signatures associated with this account, any bills related to this account, and notifications and correspondence, etc.

You are also notified that should any adverse information be placed against my credit reports, appropriate actions will be taken under the Federal Fair Credit Reporting Act (FCRA) immediately.

Thank you for your attention to this matter and cooperation.

Sincerely,
Your Name

DOWNLOAD SAMPLE LETTER

Sending your sample Fair Debt Collection Practices Act Letter by certified mail is always a good idea. You’ll have proof that your sample letter was received by the debt collector.

Fair Debt Collection Practices Act Statute of Limitations

The statute of limitations in the Fair Debt Collection Practices Act permits the collection agency to contact you for a variety of reasons after you receive the letter.

• Acknowledge receiving the sample letter from above and saying they won’t contact you again.
• Your requested verification and proof of the outstanding debt
• Filing a lawsuit against you for the debt owed to the creditor

If they contact you for any reason other than what you requested, the FDCPA gives you options if your request is ignored.

Can a Debt Collector Sue Me?

Yes, the debt collector can sue you and take you to court. The sample debt collection letter before action will stop the harassment, but you are still responsible for the debt owed.

Debt collectors have the ability to take you to court. You’ll almost certainly need to engage a Fair Debt Collection Practices Act counsel at this stage.

Debt Forgiveness

There are a few cases where debt forgiveness is possible, though it is not always straightforward.

  • Statute of limitation is a limited amount of time a creditor can ask the court to make you pay the debt. The statute of limitations .
  • 1099-C Forgiven Debt Form – and forgiven debt is considered income and taxable. The exceptions include bankruptcy, cancellation of some student loans, debt voided due to insolvency, or an amount excluded from income by law like gifts.
  • Settle debt collection with the creditor by contacting the creditor and negotiating a lower payment. If you can make an urgent payment, many creditors will agree to a significant debt reduction.

Resolve Debt Collection Problems

If you are genuinely behind on a bill, you should take care of it before being sued by a collection agency. It will be less expensive and less stressful if you strive to handle debt collection issues as soon as possible.

To resolve debt collection issues, take the following steps:

Make sure you owe the debt and verify the correct amount.

It’s possible that they have another person with the same name or that their social security numbers have been mixed up. It’s also possible that the bookkeeper didn’t process your payment correctly.

Know your budget.

Determine how much you can afford to pay off your debt. You want to be realistic so that you don’t have to deal with the same collecting agency again.

Connect with the debt collection agency or the original creditor.

If you contact the original creditor, you might be able to negotiate a better deal. It ultimately boils down to who owns your debt.

Offer to settle debt with a reduce lump sum payment.

If you can, provide a lump sum payment to clear the debt right away. A bird in the hand and an immediate cash payment will appeal to many debt collectors.

Open a new checking account at a new bank

You don’t want dishonest debt collectors to take your entire checking account balance. They’ll require your checking account once you’ve come up with a payment plan so they may debit it on a regular basis.

Open a new checking account with a different bank and only keep money in it for the next payment due each month. This will keep a unscrupulous debt collector from draining your checking or savings account of all your funds.

Stick with your payment plan.

Pay off your debt completely. As soon as the debt is paid in full, make sure the collection agency informs the credit agency of the resolution.

How Can Debt Collector Calling Family Members be Legal?

The Fair Debt Collection Practices Act (FDCPA) prohibits debt collectors from making your debts public. To get your address and phone number, they can only call family members.

Here is what a debt collector is allowed to tell family members and relatives:
• Can only ask your address, your phone number, and where you work
• If asked, must identify himself and employer
• Only call family member once unless the member asks for a callback or has new information about your whereabouts
• Agency cannot indicate you owe any debt
• Cannot contact your family in writing

Sending the Fair Debt Collection Practices Act letter sample above is the only way to prohibit a debt collector from phoning family members and relatives.

Can I block debt collector calls?

We’ve all had telemarketer calls, which seem nearly hard to avoid. Debt collectors will try a variety of methods to contact you.

Certainly, you can ban them from contacting your home or cell phone, but they might then start calling your family or employer to find out where you are. It is preferable to communicate with them rather than attempting to stop debt collector calls.

Elderly Debt Collection Laws

Debt collection regulations for the elderly are the same whether you are a senior or in your twenties. Any of the approaches listed above can still be used to block collection calls.

Seniors do have some advantages given their age and stage of their career. The federal law protects the following income from being taken from a debt collector:
• Social security
• Disability
• Pensions
• VA Benefits

Even a collection agency’s judgment against you won’t be able to take those earnings away from you.

How Many Times a Day Can a Debt Collector Call

A debt collector is not allowed to phone you during inconvenient or irregular hours, according to the FDCPA. Anything outside of the hours of 8 a.m. and 9 p.m. is usually considered inconvenient. If you work unusual hours, such as a night shift, this is an exception.

A collector cannot call you repeatedly to harass you, despite the fact that the FDCPA does not have a specific limit on phone calls.

Debt Collector Calling the Wrong Number

We’ve all gotten a call from an incorrect number. Thus it’s understandable if a debt collector calls the wrong number. Inform the collection agency right away that they have the erroneous phone number. Inquire about their name and address.

Often times, debt collector computer systems will insist on phoning despite the fact that they do not have the correct phone number. Send the debt collection agency a cease-and-desist letter. Please click here to learn more.

How to Find Out What Debt Collectors You Owe?

Debt collectors act on the creditor’s behalf to collect payments. You have no means of knowing which government entity is in charge of your debt.

Here is the way to find out what debt collectors you owe:

• Contact the original creditor: the original creditor is likely to tell you who the collection agency was hired. You can also use the conversation as a time to discuss settlement and potential discount on debt owed.
• Perform Credit Report Inquiry: The majority of debt collectors report the debts to all the credit bureaus. It’s recommended you check with all three major credit bureaus: Experian, Equifax, and TransUnion. You can also try CreditKarma.
• Wait for them to Call You: If you’re not getting calls from the collection agency, then wait for them to call you. There is a long list of collection agencies. You will unlikely be able to find the right one on your own.

The debt collector will expect payment once you contact them. Before you contact them, be prepared to pay or work out a payment plan.

I joined up for CreditKarma a few years ago and was astonished to see that a specific credit bureau had filed a medical claim against me. I looked up the agency on the internet and called them for more information. I contacted them once they revealed the original medical creditor, and they admitted it was a billing error. The original creditor had the debt collector erase it from my credit report as a mistake after repeated reminders over several months. CreditKarma, for example, receives records from numerous credit agencies and should be scrutinized for mistakes.

Do you Pay Debt Collector or Original Creditor?

Ask the debt collector if they own the debt or if they are calling on behalf of the original creditor when they contact you. You should contact the original creditor if they do not own the debt. If you are willing to pay right away, the creditor may be willing to negotiate a lower payment.

Sell Debt to Debt Collector

When it appears that the original creditor will not be able to collect, the debt will be sold to a debt collector. The creditor will cut its losses and sell the loan to a collection agency at a discount.

In many cases, debt collectors are buying thousands of outstanding loans at a time. They will buy these packages that have each. Then they take all the debtors to court.

You must send the FDCPA demand letter once you have been notified. You must also appear in court, or you will be deemed guilty automatically.

The Fair Debt Collection Practices Act (FDCPA) was created to protect borrowers from creditor harassment. To stop harassing collection calls, send a demand letter under the Fair Debt Collection Practices Act.

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