Don’t Let ‘Debt Buyers’ Put You in More Debt

MAN WORRIED ABOUT MONEY 150x150 Dont Let Debt Buyers Put You in More DebtWhat is the number one source of consumer complaints to the Federal Trade Commission (FTC)? Debt collection.

Many debt collectors abide by the law and go about their business with civility.  But according to the FTC, there are also many who engage in illegal conduct, “[some] harass and threaten consumers, demand larger payments than the law allows, refuse to verify disputed debts, and disclose debts to consumers’ employers, co-workers, family members, and friends.”

ABC News reported that the subset of debt collectors that upsets consumers the most are the “debt buyers.”  This type of collector buys debt from a bank, credit card company or other lender that has given up trying to collect the debt themselves.  The debt buyer can either collect the debt or re-sell it to another debt buyer.  What really drives complaints is when the debt buyer does BOTH, and subsequently consumers are hounded by multiple collectors.  According to ABC News, “Worse yet, some citizens have disputed a debt with one company and gotten the mater resolved, only to find that the company sold their debt yet again and didn’t pass along the paperwork showing it wasn’t their debt. So the entire process begins again.”

So if you’ve resolved your debt but continue to be hounded by debt collectors, what should you do? ABC says don’t pay it OR ignore it. Here’s their suggested plan of action:

  • Write a letter. Send it to the debt collector stating that you do not believe the debt is yours and demanding proof. Send it certified so you have a paper trail. Here are several sample letters created by the Consumer Financial Protection Bureau that get the wording right for you.
  • Check your credit report. If you are wrongfully pursued by a debt buyer, you should get a copy of your credit report to find out whether the debt buyer has reported the debt to the credit reporting agencies. To obtain your free credit report, go to the FREE website mandated by Congress: www.annualcreditreport.com.
  • Answer lawsuits. If a debt buyer goes so far as to sue you over a debt you don’t owe, don’t ignore the lawsuit. Instead, be sure to file an answer with the court. You may be able to do this yourself if you can’t afford an attorney. Alternatively, contact the National Association of Consumer Advocates, a group made up of consumers lawyers, for help finding a low- or no-cost attorney.

To read the full article, visit http://abcnews.go.com/Business/ignore-debt-buyers-pay-owe/storyNew?id=19920637.

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About Katie Burgoyne

I am the Communications Intern for the Council of Better Business Bureaus in Arlington, VA. I hail from Northern VA and am currently a senior at Villanova University majoring in Communications with a specialization in Public Relations.