Debt Collection
What is a creditor?
What is a debt collector?
Can debt collectors and creditors do
anything they want to collect a debt?
What rights do I have if the collector
works for a creditor or the collector is a lawyer?
What Will Happen if I Don't Pay?
Can a creditor sue me if I'm
making regular payments?
Can a creditor refuse my partial
payments?
I think my collection rights were
violated. What can I do?
Where can I get help managing my
debts?
What else can I do about my debts?
This page is for people who buy things for their own personal,
family, or household use. Most of the law we explain on this page
doesn't apply to debts you got to run a business.
Are you behind on your credit card payments, your home mortgage,
a personal loan or other debt? The creditor or a debt collector may
contact you. The law can't stop reasonable attempts to collect debts.
But creditors and collectors aren't allowed to be abusive.
What is a creditor?
A creditor is a person or company that a debtor owes money. A
debtor is someone who owes money. A creditor can be a person, a bank,
or a company.
What is a debt collector?
A debt collector is someone who tries to collect money from people who
owe money to someone besides the debt collector. This means that the
law doesn't treat a creditor--the person you owe the money--the same
as a debt collector. Some debt collectors work for debt collection
agencies. Some debt collectors are lawyers.
Can debt collectors and creditors
do anything they want to collect a debt?
No. Here is a list of things that debt collectors and creditors aren't
allowed to do.
Threats
Debt collectors and creditors aren't allowed to threaten to do something that
they can't or won't do. For example, debt collectors aren't allowed
to be violent or threaten to be violent. They also aren't allowed to commit crimes
or threaten to commit crimes. Creditors also aren't allowed to threaten
to take your property or your wages without a court order.
Harassment
Debt collectors and creditors may not harass, oppress, or abuse anyone.
Debt collectors and creditors aren't allowed to:
- Swear at you;
- Contact you so often that it's unreasonble;
- Lie about or misrepresent who they are;
- Lie about or misrepresent why they are contacting you;
- Contact you between the hours of 9 p.m. and 8 a.m; or
- Call you at work if you have told them not to.
Unreasonable "Publication"
Debt collectors and creditors aren't allowed to tell other people
about your debt.
But if a creditor has a court judgment or court order against you, they
can tell others about it. Here is a list of who debt collectors
and creditors aren't allowed to tell about your debt. There are some
times when these rules don't apply. The times when the rules don't
apply are listed below after the normal rules.
- Collectors and creditors aren't allowed to tell your employer
that you owe a debt;
- But a debt collector can contact
your employer if the collector only asks where to find you and
doesn't tell your employer that you owe a debt;
- Collectors and creditors aren't allowed to contact your family
members.
Are you married? Collectors and
creditors can tell your spouse about the debt.
Are you under 18? Do you live with your
parent or guardian? A collector or creditor can tell your parent or guardian about your debt.
- Collectors and creditors aren't allowed to inform anyone about your
debt or use any kind of communication that
would ordinarily be seen by any other person.
For example, a bill collector or creditor
can't post your bounced check near the cash register at their
business. A collector or creditor
also can't send you a postcard about your debt.
Remember: A collector or creditor can do all or most of the
things listed above if the creditor has a court judgment or order
against you for the debt.
Deceptive Representations
Debt collectors and creditors can't trick people to try to collect
a debt. For example, debt collectors can't lie about the legal
status of the debt. For example the collector can't say it has a
court order or judgment against you if it doesn't. A private
collector or creditor also can't claim that it works for or with any
state or federal government agency. A private collector or creditor
also can't use any paperwork that makes it look like the collector works
with or for a government agency or office.
Unconscionable Means
Debt collectors and creditors can't use unconscionable methods to
collect a debt. Debt collectors can't add their fee to the amount
of the debt except in special cases. Is a lawyer representing you?
Have you told the collector that you want them to communicate only
with your lawyer? Then the collector can only contact you by sending
a statement of your account.
What rights do I have if the debt
collector or lawyer is not the creditor that I owe the money?
Is the collector that is contacting you seperate from the person, bank,
or company that you money? Is the collector a lawyer who regularly
collects debts? You have more collection rights. These extra rights
are listed below.
You can stop a collection agency from contacting you by writing a
letter. The collection agency may send you a written notice
containing the amount of the debt, the name of the creditor, and what
action to take if you believe you do not owe the money.
Form Letter to Stop
Collectors from Contacting You
What if I don't owe the money? You can send the collection agency a
letter telling them that you don't owe the money. You have to send the
letter within 30 days of the first time the collector contacts you. Then
the collector can't contact you to collect the debt. What if a
collector then sends you proof that you do owe the debt? Then the
collector can start trying to collect the debt from you again.
What Will Happen if I Don't Pay?
Have you defaulted on a loan or fallen behind on your credit card
payments? The creditor usually has the right to go to civil court to
get a court judgment or order to collect the total amount of the debt
at once. Creditors will often settle the case for less than the total
amount.
Can a creditor sue me if I'm making
regular payments?
Yes. Have you defaulted or fallen behind on your payments? The
creditor can sue you if you are behind even if you are sending in
payments.
Can a creditor refuse my partial
payments?
We have never heard of a creditor or a collection agency sending money
back to the debtor! A creditor or collection agency might tell you that
they "won't accept" partial payments, but they will keep whatever money
you send them and keep asking you to send more.
I think my collection rights were
violated. What can I do?
Has a creditor, attorney or collection agency done any of the things
listed above? The first thing you should do is send them a certified
letter telling them to stop all contacts with you. If they continue to
contact you or continue to violate your rights, you
should contact Vermont Legal Aid at (800) 889-2047.
If you want to make a report to a state agency, you can write to the
Attorney General's Consumer Assistance Program at:
Consumer Assistance Program
Morrill Hall-UVM
Burlington, VT 05405
Phone: 800-649-2424 (toll-free) or
802-656-0862 (Chittenden County)
email: consumer@uvm.edu
Where can I get help managing my
debts?
The National Foundation for Consumer Credit has a consumer credit
counseling service with offices throughout Vermont. For more
information about their services, or to schedule an appointment, you
should contact them at:
Consumer Credit
Counseling Service of Vermont and New Hampshire
P.O. Box 676
Concord, NH 03302
800-327-6778
What else can I do about my debts?
You might consider filing for bankruptcy. There are many things to
decide before you file for bankruptcy. We may be able to help. Call us at (800) 889-2047.
Vermont Law Help, 2009.
This is a website about Vermont law. We give this information
as a public service. It is not legal advice. We are not acting as your
lawyer.
Always consult a lawyer, if you can, before taking legal action.
