8 Important Things Debt Collection Agents Don’t Want You to Know

If your nerves are in tatters from screening calls and your thumb is sore from hitting ignore on your cell phone, it’s time to pull your head out of the sand. Get familiar with your rights when it comes to debt collection.

Chances are you have more options than you might expect regarding your debt situation. Collection agents bank on the fact that you may not be familiar with the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Billing Act (FCBA), which were created to protect consumers in debt.

Educate yourself on what collection agents can and can’t do, and you’ll find those pesky phone calls a lot less bothersome.

1. No Down Payment Required

Debt collectors can earn a hefty commission from collecting from you—generally 30 to 50 percent if they’ve reached their monthly quota.

For that reason, they’ll often insist on receiving a large payment to get repayment started or to prevent collection fees from growing. No need to fall for these tactics. Just pay what you can.

2. Payment Deadlines Are Non-Existent

You’re already late on your payments—that’s why debt collectors are calling you. Creating a sense of urgency by insisting on some mythical deadline is an attempt to get you worried enough to pay up as soon as possible. Collection agents are hedging their bets with this tactic. They know that the longer lead time they give you, the less likely you are to pay.

3. You Don’t Have to Answer the Calls

You can ignore debt collectors if you want. No law requires that you work with them or answer their phone calls. And if you request that they stop contacting you via written letter or inform them that an attorney is handling your debt, they must immediately refrain from contacting you. And by law, collectors can only contact you between 8 am and 9 pm.

4. Consequences Are Often Exaggerated

Avoid falling for the hype when a debt collector tells you that your credit score is going to suffer (it most likely already has), or they’re going to seize your belongings (illegal in some states). The only thing they can do is demand that you pay—but you don’t have to comply.

5. Personal Financial Information Isn’t Required

If a debt collector tries to get information from you such as your bank account numbers, employment background and your social security number, flat out refuse to divulge the information.

Such personal financial facts aren’t required, and giving them out can be dangerous at worst and make the collection efforts more annoying at best.

Related article: 10 Early Signs That Your Identity Might’ve Been Stolen

Personal financial information can help debt collectors find you if you move or change your number or sue you for repayment. When they have your bank account and social security number, they can discover your bank account balances. So when you tell them you’re broke and they mention the $500 you have in your account, you’ll find yourself explaining how the money is earmarked for other bills.

6. Crossing State Lines Is Prohibited

Debt collectors don’t want you to know that if a company has sued you for repayment and won, but you are in a different state, they can’t legally force you to pay. Transferring the judgment for repayment to another state is often not financially feasible for them.

7. Wage Garnishments Have Limits

If a debt collector warns that your wages could all be garnished, they’re lying.

“For ordinary garnishments (i.e., those not for support, bankruptcy, or any state or federal tax), the weekly amount may not exceed the lesser of two figures: 25 percent of the employee’s disposable earnings, or the amount by which an employee’s disposable earnings are greater than 30 times the federal minimum wage (currently $7.25 an hour).” – U.S. Department of Labor

For instance, if you live in California, where the minimum wage is $9 and you make $300 a week, then only $30 could be garnished from your paycheck each week. You also have the option to show that garnishment would cause you and your family financial hardship.

8. Student Loan Repayment Options Exist

Thanks to the 1992 Higher Education Act, you have the right to show financial hardship and set up an affordable repayment plan with the collection agency that can be as low as $10 a month to repay student loans. Once you successfully pay nine out of 10 payments on time, the Department of Education takes over your student loans once again. Knowledge truly is power when it comes to debt collection.

By keeping these consumer rights in mind, you’ll find yourself being more assertive with debt collectors and immune to their high pressure tactics, which means you’re better able to make the right decisions for your financial situation.