What should I know if I have debts in collection?

There can be common instances when you have fallen behind on your debts or bills. It becomes a problem when your debt reaches collection. Businesses use third-party agencies to manage their collections, and you may have to deal with them regarding your unpaid invoice or debt. But don’t panic and don’t ignore the debt collectors either. Knowing your rights and responsibilities can help you deal with the situation smoothly in such cases.

Here’s everything you need to know if you have debts in collection.

You deserve to know

If you are being contacted by a third-party debt collector or your creditor, you have full rights to know everything regarding the debt—the amount, due date and when the payment was charged. If you don’t recognise the creditor or debt, you can ask the third party to give you the details in writing by email or post.

You can dispute a debt

When you interact with the debt collection agency and notice an unknown debt on your credit report that you didn't take, you can dispute it. You should dispute the credit through a certified email, and the online debt collection company is obligated by the law to investigate your dispute. If it turns out that it was a mistake, you won’t be asked to pay. Else they will provide sufficient proof to confirm that the debt is yours.

They cannot contact you whenever they want

The credit collection agency can contact you regarding the debt. However, they cannot contact you whenever and wherever they want. There are specific rules and regulations on how they can contact you. They include:

• They can only contact you between 8 am to 9 pm.
• They cannot contact you at your workplace unless to confirm your workplace.
• You can specify how you want to be contacted.
• They cannot share the details of your debt with anyone except your spouse or legal representative.
• They cannot threaten or abuse you during your interactions under any circumstances.
• You can ask them not to contact you at all.

You can negotiate your dues

Whether you are dealing with third-party collectors or the creditor, you can always negotiate your dues. You can ask them to reduce the amount by giving you a discount. Or you can ask them to discuss a payment plan through which you can make partial payments to pay off the dues.

Creditors can take legal action against you

Third-party collectors will warn you about the legal action the creditors can take against you. You should not consider their empty threats, as the creditor can sue you to recover their money. However, the creditor cannot sue you if your debt is time-barred and the duration has passed. However, the creditor or the third-party collector can still contact you to pay your dues.

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