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Credit card debt collection rules: Know your rights

For many in Florida, periods of financial hardship lead to the need to rely on credit cards to cover basic living expenses. Many people are able to pay down those balances within a short period of time, until a sudden change in their financial lives creates a credit impasse. An unexpected job loss or illness can throw one’s life off-balance and lead to a serious credit card debt issue. Making matters worse, once those accounts fall past due, credit collections begin.

Debt collection can be one of the most stressful experiences that a consumer can encounter. There are a range of laws and regulations in place that limit the actions that such firms can take against delinquent borrowers. Many of these agencies, however, stretch or blatantly break these rules and make life miserable for consumers who are also facing continuing financial woes. It is important to know one’s rights in regard to debt collection.

For example, collections workers are not permitted to make threats that a borrower will be arrested due to unpaid debt. They are also not supposed to suggest that someone will lose his or her job as a result of unpaid credit card debt. These calls should be limited to attempts to make payment arrangements for the outstanding balances and should not stray from that line of discussion.

It is also improper for a debt collector to attempt to obtain sensitive financial information about the borrower. One should avoid answering any questions concerning income, savings or other assets. Here again, the only topic that should be discussed is how to reach a payment arrangement that works for both sides.

When dealing with debt collection, it is important to remain calm and focused. Keep a written record of all communications, both through the mail or over the phone. Also, be aware of the full range of outstanding credit card debt. In some cases, the best course of action for Florida residents is to file for personal bankruptcy, which will not only put an end to collections efforts, but will also lead to the discharge of many forms of consumer debt.

Source: NBC Washington, “Debt Collector Rules“, Liz Crenshaw and Katie Roberts, April 28, 2014

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