This article was prepared by CLS, GHLA, NHLAA and SLS.
Debt Collection: Know Your Rights
January 2014
Printer-friendly version
Print a Brochure
If you are late in paying their bills, chances are someone will contact you to collect the money you owe. You may need money for car loans, credit card bills, medical bills, utilities, mortgages and others.
I have called for a debt … what I have to know?
It can be called directly by a creditor or a collection agency.
Creditor
A company to whom you owe money
(Example: a company credit card)
Both are called “debt collectors”
Collection agency
A separate company that is dedicated to collecting debts
Your rights may be different depending on whether you owe money to a creditor or a collection agency. Creditors and collection agencies are also called “debt collectors.” Debt collectors try to collect money even if you have money or think you owe nothing.
This booklet explains your rights and debt collection
What needs to know if a debt collector calls
What accounts should pay first
What if he does not believe the debt is legitimate
What to do if you have no money to pay the debt
What debt collectors can and can not do
What if the debt collector sues
What accounts should I pay first?
If you can not pay all your bills, you have to decide which bills to pay. Think about what would happen if you do not pay certain debts. Ask yourself, “What more affect my family?”
You may want to pay in this order:
1. The health of your family
Food, medicine, health insurance and more.
2. The property of his family
Rent, mortgage, condo fees, property taxes, utilities (heat and electricity).
3. Other accounts of his family
Payments for your car, if the car is essential (for example, if you need a car to get to work);
Child support;
Income taxes; Y
student loans guaranteed by the government.
If you have money left after paying these accounts, you can decide how much you can pay each of the other debt collectors.
budgets
For advice on how to budget, call or visit:
The University of Connecticut
Cooperative Extension System
305 Skiff Street
North Haven, CT 06473
203-407-3161
I do not think that this debt is legitimate. What can I do?
you should not be billed for something I did not buy or already paid. But sometimes mistakes are made. You can do the following …
If a creditor says you owe money …
You have the right to contest (disagree with) office. To dispute it,
Look at the back of your monthly statement for instructions on how to file a dispute.
It is best to write a letter. You can use the letter A behind this booklet.
Including a copy of your monthly statement and marking the item that is challenging.
If a collection agency tells you who owes you money …
You should immediately write a letter to the collection agency, saying what they should not say. You can use the letter A behind this booklet.
Until you send proof of the debt, they must stop calling you.
What can happen next?
If you are sent proof, but you think it is wrong, it should
Send another letter, along with proof that you paid or the debt is not yours.
If you are trying to collect, call Statewide Legal Services. If you are over 60 years old, call 1-800-296-1467 or contact a private attorney.
If you do not send proof, no need to do anything. They have to stop calling.
What can you do if you have a debt but can not afford it?
Debt collectors try to pressure you to pay more than they can.
If you can not pay the full amount, return the amount you can pay every month – even if they say is not suffi cient. If you pay something every month, perhaps you can avoid being sued for the full amount of the debt.
If you can not pay anything and you want to stop calling, you can write a letter (see below).
Can I be called to ask me for money?
Yes, but there are limits to what they can do. They are used to pressure him to accept pay something. You do not need to listen to what you are being asked – just hang up.
Can I be sending letters demanding payment?
Yes, but you have the right to send a letter to tell them not to communicate more with you.
What I can do to stop calling me or me?
Write a letter saying:
Include your account number; Y
Make a copy of the letter.
This letter is to notify you that I do not want to call, write or visit at home or at work on the money that you think I should.
Important: Although no longer communicate with you, as you will still owe the money, and they can sue in court to collect the money owed.
Once you have received your letter,
A creditor can continue to communicate with you, but often fail to do so.
A collection agency can only contact you to tell you what steps they will take. (For example, they will demand in court or do not communicate more with you.)
What can not do debt collectors trying to collect?
There are many things that debt collectors can not do. They can not abuse, harass, lie or threaten. They can not discuss your debt with others (such as neighbors, friends, relatives or your employer). If you do any of these things, or some of the things listed on the next page, you will be breaking the law.
What I can do if a debt collector violates the law?
Call or private attorney immediately. You may be able to sue the debt collector for violating the law and receive money in return. Call 1-800-453-3320 – or – if you are over 60 years of age, call 1-800-296-1467.
You can also submit a letter of complaint to the following agencies (use the letter A behind this booklet):
Consumer Affairs Division
State Banking Department
260 Constitution Plaza
Hartford, CT 06103
860-240-8170
1-800-831-7225
www.ct.gov/dob
Federal Trade Commission
Debt Collection Practices
Washington, DC 20580
1-877-382-4357
www.ftc.gov
Debt collectors CAN NOT …
Using abusive or profane language, obscene. If they start to insult, taunt you or speak abusively, hang up.
Calling it an exaggerated number of times. They can not call again and again until you answer the phone.
Call before 8:00 a.m. and 9:00 p.m.
Contact you at work if you asked them to stop calling.
Threatening to hurt you, your property or reputation, or to someone else.
Threatening to tell someone about your debt.
Tell others about your debt without your permission.
Tell him they will demand when actually think not.
Lie about who they are, or pretend to be a lawyer or government.
Suggest that you committed a crime, they will be arrested or go to jail if not paid.
Falsely indicate that the documents sent to you are legal court documents.
Suggest that you can garnish your benefi ts (as benefi ts Social Security, disability, pension, retirement, child support, alimony or any other protected fund).
Ask you to pay more than they should.
Share information about your debt in other ways. For example, they can not
– Send a postcard with data on their debt;
– Put something on the envelope indicating that the letter is on its debt; or
– Print information about your debt in newspapers or magazines.
Force him to accept collect calls or pay for telegrams. (You should not accept these charges.)
What can you do to try to collect?
Things that debt collectors can do to try to collect depend on the type of debt.
Debt collectors CAN …
Discuss your debt with your spouse and your attorney (if told who his lawyer).
Call your employer to confi rm that work there or to obtain their contact information.
Do other things, depending on the type of debt. For example:
Rental. Your landlord can take legal action to force him to move. (See our booklet: Eviction (Evictions))
Public services. Your utility company may cut service unless you pay the minimum amount each month. But the utility
– You can never cut off service if you have a problem that “life threatening.”
– You can not shut off service during the winter (November 1 to May 1) if it can demonstrate that it has “serious economic problems.”
(See our booklet Help troubled utility.)
Objects that the seller can repossess (resume). (For example, a car). The debt collector may seize him the object.
Mortgage. The bank can take you home through foreclosure. (See our leaflet, foreclosure when you are behind on your mortgage).
Other objects. The debt collector can sue.
What if the debt collector sues me?
The debt collector can deliver legal documents. Has to meet the demand, otherwise the debt will win the trial.
What can the debt collector if you win in court?
If the debt collector sues you and wins the trial, the court will decide who owes money and ordered to pay a certain amount of money every week. Then, if you do not pay the amount ordered by the court every week, the debt collector may request a court order to take money from your paycheck or bank account, or get a good. (Part of their money and their pay is protected … see below.)
What can you do if a debt collector sues me and win?
A debt collector CAN …
Take $ of pay (performance pay / wage execution)
UNLESS…
Net weekly pay is less than 40 times the minimum wage ($ 348 for 2014, $ 360 per 2015).
Take $ from your bank account
(Foreclosed / bank execution)
UNLESS…
Your money is protected because it is a direct deposit
Government benefits such as Social Security, unemployment, etc.
Child Support
Feed penstion
Pension
Take your goods (execution of
goods / property execution)
UNLESS…
Rent or has assets that can be taken.
If you get any kind of run …
Lámenos at 1-800-453-3320 or if you are over 60 years old, call 1-800-296-1467
Call Center Court Services; or
Call a private attorney
The money from my bank account is “protected”?
Some of the money is in your bank account can be protected. But you must file certain documents in court to protect him.
Debt Creditors can not take money from your bank account if you received a direct deposit:
Social Security benefits (retirement, disability, survivor)
Unemployment benefits
State Social Welfare
Child Support
Feed penstion
Pension
Disability benefits (SSI and SSD)
If you think your money is protected, tell your income is protected (can not be charged) and does not want to communicate with you. For that:
Write a letter saying:
This letter is to notify you that I do not want to call, write or visit at home or at work on the money that you think I should. This letter is also to Carles notifi my income is exempt from collection as required by law.
Include your account number; Y
Make a copy of the letter.
Limit the amount of protected money
They are protected automatically two months of its direct deposit of child support, alimony, pensions or government benefits or $ 1,000, depending on whichever is greater. If you have protected more than this amount in your bank account, the debt collector can take your money through a “bank run.” You may be able to recover this money if you file a claim of exemption form.
direct deposit of paychecks
Be careful if you receive their checks by direct deposit. A debt collector can take money from your bank account even if you earn less than $ 348 per week ($ 360 per 2015). However, if you take home less than $ 348 per week ($ 360 per 2015) you can get your money back after a court hearing.
TIP: Instead of making you deposit the check directly into your account, it may be better to ask for a paper check.
What if a creditor tries to take money from my pay?
It is common that a creditor or collection agency threatens to take money from your pay. You can be protected – see page 9. Also, see our brochure wage assignment.
Should I think about filing for bankruptcy?
In some cases bankruptcy can be a good choice. See our brochure Are you thinking about filing for bankruptcy?
Letter A: Telling a creditor or collection agency that you owe a different amount of money than what you are being charged, or why you have not paid your account
[Your adress]
[Today’s date]
[Name of creditor or collection agency]
[Address of the creditor or collection agency]
Ref: billing error notice – Account number: ____
Dear Sir / Madam:
I have received your invoice date ___referente one invoice amount owed by _____ [the category that billed]
[Check the appropriate box]
I paid the bill in full
I paid part of the bill and debo____ [amount]
I have not paid the bill because ____ [reason]
Please verifi quen their records and correct myself. Also, please do not send me bills or call me until this matter is resolved.
Sincerely,
[Your signature and name in print]
Letter B: Making a complaint because a creditor or collection agency violates the law
[Your adress]
[Today’s date]
[Name of the agency that is writing him]
[Agency address to which you are writing to]
Ref: Collection Practices: ______
[Name and address of the collection agency]
Dear Sir / Madam:
I want to file a formal complaint against [name of company] for the actions it took in trying to collect a debt. My complaint is due to [type which made the collection agency and violated the law].
Please investigate this matter and make it stop. You can reach me at [number of TV.] between the hours of __y__.
Sincerely,
[Your signature and name in print]
Embargo
A creditor can not enter your home without your permission to take possession of their items such as furniture or appliances. If someone tries to force their way into your house or garage, call the police. If you leave your car parked on the street or in the driveway of his home, where the creditor can see, it can be easily seized. If a creditor is threatening to repossess your articles, you may want to talk to a lawyer. It is easier to prevent something from garnishing try to recover once it has been repossessed.
Yet calendar
But Day – The creditor takes back the item.
No later than 3 days from the impound – The creditor must give you a written statement indicating how much you owe and the cost of the seizure and storage of your personal good. You may receive this written notice prior to the embargo.
From 1-15 days after embargo- If you did not receive a written notice prior to the embargo, you can retrieve your personal assets to pay the amount you owe, plus the cost of the impound and storage. If you received a written notice prior to the embargo, you could retrieve your items reaching an agreement with the creditor, either refi nancing their debt or paying it altogether.
Before the creditor sells its products – The creditor must give you a written notice at least 10 days’ notice of the place, date and time of any public auction, or the date after which you can sell your items in a private sale. You can retrieve your items until the day of resale if you reach an agreement with the creditor.
Day resale – The creditor sells its items.
1-30 days after the resale – The creditor gives you a written statement indicating how much your items and how much money from the sale was spent was sold.
This booklet was produced by the Legal Assistance Resource Center of Connecticut, in cooperation with Connecticut Legal Services, Greater Hartford Legal Aid, New Haven Legal Assistance Association, and Statewide Legal Services.
The information contained herein is based on the laws of Connecticut to January 2014. We hope this information is helpful. It not intended to be legal advice. If you need advice for your situation, call Statewide Legal Services or contact an attorney.
For more information:
Statewide Legal Services: 860-344-0380 (Central and Middletown CT) or 1-800-453-3320 (all other regions).
You’re not from Connecticut?
The information on this website is for Connecticut residents only. Visit LawHelp.org to find a legal services program and / or a Web site for legal information in your area.
