Protecting yourself from creditor harassment

Although by most accounts, the economy has improved significantly since the recession of 2008, many people were scarred by preceding tough economic times and are struggling to get back on their feet. This is especially the case if you suffered a job loss or an unexpected medical emergency.

In cases where you fall behind on your bills, you may encounter creditor harassment in the form of phone calls from debt collectors almost every day. Although you may feel powerless, it is important for you to understand that you have protections under federal law that set the ground rules on how debt collectors must behave. Under the Fair Debt Collection Practices Act (FDCPA), a debt collector may not:

  • Use abusive or obscene language, threats of violence or make an unreasonable number of phone calls when communicating to you about your debt.
  • Attempt to mislead you about the character, amount or legal status of your debt.
  • Communicate with you at times when the debt collector knows or should know is an inconvenient time. The law specifically says that calls after 9 p.m. or before 8 a.m. are off limits.
  • Speaking with third parties about your debt, if you have told them to stop.

Unfortunately, in spite of these protections, many debt collectors continue to use illegal collection tactics. During 2013 alone, the Federal Trade Commission received over 204,000 complaints from consumers regarding illegal debt collection tactics. According to a report by the Consumer Financial Protection Bureau, most of the complaints concerned attempts by the debt collector to make an excessive number of calls or misrepresent the character, amount or legal status of the debt, both of which clearly violate the FDCPA.

Bankruptcy can make it all go away

Although the FDCPA protects against creditor harassment, it does not prevent creditors from attempting to collect valid debts (provided it is done legally). If you are receiving collection calls, it is important to consider bankruptcy as an option.

Once bankruptcy has been filed, the automatic stay goes into effect, which puts a stop to all collection attempts, including collection calls. Any creditor that violates the stay can be fined for contempt of court. During the bankruptcy process, most of your debt is discharged, which forever prevents creditors from attempting to collect it at a future time. Once you have completed the bankruptcy process, the debt that you had before you filed has been eliminated or made current, giving you a new start financially.

If creditors are hounding you, it is important to contact an experienced bankruptcy attorney as soon as possible. An attorney can explain further how the bankruptcy process works and can suggest the best way to get you back on your feet financially.