Dealing With Debt Collectors - 5 Steps To Protect Yourself

When dealing with debt collectors, the stress and anxiety can make you forget a crucial fact: you have rights. There are a number of state and federal debt collection laws that exist to protect you, including the Fair Debt Collection Practices Act (FDCPA).

So when a creditor calls, don't panic. Instead, here's a simple 5-step process you can follow when dealing with debt collectors.

Step One
When the collection agency calls, ask them to send you a written notice of the debt. It's your legal right under the FDCPA. They then have five business days to send you the notice.

Step Two
Once you receive the debt notice, review it carefully. In particular, you should make sure that:

* You really do owe the debt. If you don't, you can dispute it.

* The amount is correct. Make sure that the creditors haven't added any extra illegal charges. If you believe the amount is incorrect, you can dispute it and/or contact an attorney.

* The debt is not too old. If the debt is too old, you can send the collection agency a cease contact letter. Note that certain debts, such as child support, tax debts, and student loans, aren't covered by this statute of limitations

Step Three
If you believe that you do not owe the debt or that it is too old, you can send the collection agency a cease contact letter. Send the letter through certified mail and keep a copy for your records - good records are important when dealing with debt collectors.

IMPORTANT! If you send a creditor a cease contact letter, the only way they can collect from you is to sue you. It's best to talk to an attorney before sending a cease contact letter, to be sure that you're protected.

Step Four
If you think you do owe the debt, but you can't afford to pay it, you do have options. A bankruptcy attorney can help you find out if your property is protected from collection agencies.

Step Five
If you owe the debt, but you can't pay it in full, try negotiating a settlement. Collection agencies will often accept a smaller lump sum rather than the full amount. Just be sure to get any agreement you come to in writing!

If you follow these five steps when dealing with debt collectors, you should end up in pretty good shape. Remember, the law is there to protect you!

If you're looking for an attorney, but can't afford to pay for one, you have a few options available to you.

* If the creditors acted illegally at any point, you may be able to sue them for damages. If you win, they may have to pay your legal fees. Because of this, some attorneys will take your case on a contingent fee basis - they don't get paid unless you win.

* The Collection Complaint Hotline offers a free and confidential consultation with attorneys who deal with debt collectors.

Dealing with debt collectors can be stressful, but this five step process will help set you on the right path.

Donald Coggan of accessible.org has helped disabled people deal with debt since 1998. Visit his site to learn more about dealing with debt collectors and receiving free legal advice.

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