What can I do if I'm being harassed by a collection agency?

Two laws protect consumers from abusive debt collectors: the Fair Debt Collection Practices Act, a federal law; and the California Fair Debt Collection Practices Act. The federal law applies only to third party collection agencies, or those agencies collecting debts on behalf of original credit grantors. The California law applies to both original creditors and collection agencies.

Your most powerful weapon against a collection agency under the federal law is to write a letter asking them to stop trying to contact you, although this doesn't mean you don't owe the debt. If the agency continues to harass you it is in violation of the federal law. It can communicate with you only to inform you that it plans to take actual legal steps.

The following restrictions apply to collection agencies under federal law and to all bill collectors under California law. Collectors CAN:

• Contact you by phone between 8:00 a.m. and 9:00 p.m.
• Contact you initially by phone but within five days must provide you with a letter that reflects the amount of the original debt, plus any interest that has accrued, the name and address of the original creditor and a statement that states you have 30 days to dispute the debt.
• Contact your lawyer only, if you have one.
• Contact third parties only in order to locate you.
• Charge interest on the debt if it was called for in the original contract or if allowed by state law. Rates may vary by state. In California interest may be charged even if it was not in the original contract.
• If you ask the collection agency to verify the debt within 30 days of when it initially contacted you, it must stop all collection efforts until it does.
• Demand payment in full. Most collection agencies will let you make partial payments, but if you default on the agreement they can insist upon full payment.
• If you request in writing that a collection agency stop all communication with you, it must stop. But it can communicate with you to inform you that it plans to seek legal remedy or it is terminating collection efforts. (This is a Federal law and does not apply to original creditors.)

The following prohibitions apply to collection agencies under federal law and to all bill collectors under California law. Collectors CANNOT:

• Contact you by phone before 8:00 a.m. or after 9:00 p.m.
• Fail to state: the agency's name, address, and phone number; the creditor's name; the amount owed; interest owed.
• Attempt to or collect more than is owed.
• Use any language that is obscene, abusive or profane.
• Call constantly so that they deliberately annoy or disturb you.
• Threaten to sue you or garnish your wages, unless they intend to actually take this action.
• Threaten to ruin your credit.
• Threaten to send a sheriff to your house to have you arrested or your property seized.
• Threaten to take any action that they cannot legally take.
• Discuss your debt with third parties, or reveal to them that they are calling from a collection agency and that you owe a debt.
• Insult you or a third party.
• Use phony documents that appear to be from a law office or government agency.
• Contact you at work if the collector is aware that your employer prohibits such calls.
• Contact you after you have advised a collection agency in writing to stop.

Additional California Debt Collection Law

California law allows original creditors and bill collectors to contact an employer for the following reasons only:

• To verify the debtor's employment and location.
• To set up wage garnishment after winning a judgment in court.
• To verify medical insurance for medical debts.

Collectors cannot discuss the debt with the debtor's employer or contact relatives except to locate the debtor.

To complain about a collection agency, write or call the:

• Federal Trade Commission, Division Credit Practices, 901 Market St. #570, San Francisco, CA 94103 (415) 356-5270
• Federal Trade Commission, 11000 Wilshire Blvd., Suite 13209, Los Angeles, CA 90024 (310) 235-4000
• Attorney General, Public Inquiry Unit, P.O. Box 944255, Sacramento, CA 94244, (800) 952-5225 or (916) 322-3360 (outside of California)

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