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Better Business Bureau ®
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In Metropolitan New York, Long Island, and the Mid-Hudson Region
Debt Collection Practices
The day of strong armed debt collection practices should be over. Federal legislation, a New York State law and New York City regulation prohibit abusive, deceptive and unfair debt collection practices by debt collectors. Unfortunately, there are still some companies that use unfair and illegal tactics to try to collect debts, and consumers should know their rights in such situations.

What Debts are Covered? 

Personal, family, and household debts are covered, like money owed for the purchase of a car, for medical care or for charge accounts.
 

What is a Debt Collector?

A debt collector is an individual who as part of his or her job, regularly collects debts for others. Under federal law, this usually does not include your creditor, but only applies to third party debt collectors. In New York City, this definition is extended to include anyone whose job is to collect debts for others. These individuals may work for the creditors themselves, for example, in the collection departments of stores, hospitals, doctors or lawyers offices.


How May a Debt Collector Make Contact?

A debt collector may contact you in person, by mail, telephone or telegram. But, in connection with the collection of the debt, a debt collector cannot contact you under the following circumstances without getting your approval first or getting approval from a court:

  • Under New York State and New York City law, at any unusual or inconvenient time such as before 8:00 AM or after 9:00 PM;
  • At any unusual or inconvenient place or at your job if your employer prohibits or disapproves of your receiving such communication.
  • With excessive frequency. More than twice during seven days is excessively frequent. This does not include communications made in response to communications from you.
  • If the debt collector knows the consumer is represented by an attorney in respect to the debt.



Who May a Debt Collector Contact Concerning a Debt?

Generally, debt collectors cannot communicate with any person about your debt other than you or your attorney without getting your written consent or your attorney's consent except to find out where you live and work. In that the purpose is to try to contact you. A debt collector may only identify themselves and state that they are seeking location information.

In trying to locate you, a debt collector must not tell anybody that you owe money, in most cases, talk to any person more than once, use a post card, or put anything on an envelope or in a letter or telegram that identifies the writer as a debt collector.

A debt collector may contact a consumer reporting agency, the creditor, the creditor's attorney, an attorney representing you, or the debt collector's employers or attorney about your debt without getting your consent.



What is the Debt Collector Required to Tell You About the Debt?

Within five days after you are first contacted, the debt collector must send you a written notice containing the following information (unless all this information is included in the initial communication):

  • The amount of money you owe,
  • The name of the creditor to whom you owe the money,
  • A statement that unless you, within 30 days after the receipt of the notice, dispute the validity of the debt, the debt will be assumed to be valid by the debt collector,
  • A statement that if you notify the debt collector in writing within the 30 day period at the address designated by the debt collector in the notice that the debt is disputed, that the debt collector will obtain verification of the debt and a copy of such verification will be mailed to you.
  • A statement that on your written request within the 30 day period, the debt collector will provide you with the name and address of the original creditor, if different from the current creditor,
  • An address to which you should send any communication which disputes the validity of the debt or any portion of it or any communication requesting the name and address of the original collector.



Can a Debt Collector Be Stopped From Making a Contact?

Yes, you may stop a debt collector from contacting you by saying so in writing. Once you tell a debt collector not to contact you, the debt collector can no longer do so, except to tell you in writing that there will be no further contact or to tell you that some specific action may be taken. Also, federal law states that a debt collector may not contact you if you send the collection agency a letter stating you do not owe money within 30 days after you are first contacted. However, a debt collector can renew collection efforts if you are sent proof of the debt.

What Types of Debt Collection Practices are Prohibited?

A debt collector may not harass, oppress or abuse you. For example, a debt collector cannot:

  • Use violence or threats of violence to harm your property or reputation,
  • Publish a list of consumers which says you refuse to pay your debts (except to a credit bureau),
  • Use obscene or profane language,
  • Repeatedly use the telephone to annoy you,
  • Advertise your debt.

A debt collector may not use false statements when collecting a debt. For example, the debt collector cannot:

  • Under New York State and New York City law, falsely imply that a debt collector represents the government or is an attorney,
  • Falsely imply that you committed a crime,
  • Falsely represent that the debt collector operates or works for a credit bureau,
  • Misrepresent the amount of the debt,
  • Represent that papers being sent are legal forms, such as a summons, when they are not or that they are not legal forms when they are.
  • Disclose or threaten to disclose information about you that the debt collector knows is false.

Also, a debt collector may not say:

  • That you will be arrested or imprisoned if you do not pay your debt,
  • That he/she will seize, garnish, attach or sell you property or wages, unless the debt collector or the creditor intends to do so and it is legal,
  • That any action will be taken against you which cannot be legally taken.

A debt collector may not:

  • Give false credit information about you to anyone,
  • Send anything that looks like an official document which might be sent by any court or government agency,
  • Use any false name.

A debt collector must not be unfair in attempting to collect any debt. For example, the debt collector cannot:

  • Collect any amount greater than the amount of your debt, unless allowed under New York State and New York City law,
  • Make you accept collect calls or pay for telegrams,
  • Put anything on an envelope other than the collector's address and name. Even the name cannot be used if it shows that the communication is about the collection of a debt.


What Control Do You Have Over Specific Debts?

If you owe several debts, any payment you make must be applied as you choose. A debt collector cannot apply a payment to any debt you feel you do not owe.


What Can You Do if the Debt Collector Breaks the Law?

You have the right to sue a debt collector in a State or Federal court within one year from the date the law was violated. You may recover money for the damage you suffered. Court costs and attorney's fees can also be recovered. A group of persons may sue a debt collector and recover money for damages up to $500,000.

Remember: While the law now protects you against strong-arm debt collection practices, it does not relieve you of your responsibility to pay your debts. Nor does violation of the law by the debt collector relieve you of your obligation to pay. You may be able to sue the debt collector for violation of the law, but you still have to pay what you owe.

Also, realize that certain debt collection practices are legal. As stated above, the debt collector may contact people you know and work with in order to locate you. And, providing these provisions are in your contract, the debt collector may be able to levy delinquency charges against you, charge you collection costs; and under certain circumstances accelerate your payment schedule.