FirstLibertyDebtRelief.Com

Every year, hundreds of thousands of Americans declare personal bankruptcy. Let’s face it—with large corporations, multimillionaires, and many average people declaring bankruptcy every day, it just doesn’t carry the stigma that it used to.

Creditors have been alarmed in recent years by the dramatic increase in the number of personal bankruptcies. They insist that one of the main reasons consumers are filing for bankruptcy in unprecedented numbers is because the bankruptcy laws are lax. In other words, some bankers think that consumers take on too much debt knowing that they don’t really have to pay it back.

A woman was told by a collection agency that her credit card company was going to sue her for fraud because she used her credit card after charge privileges had been suspended by the creditor. She didn’t think that was the case, so she went back through her records, then called the credit card company to find out what they were talking about. “We don’t have any intention of suing you for fraud,” she was told. She called back the collection agency and told them what she had learned and accused them of breaking the law in trying to collect the debt. They didn’t call her again.

In 1978, Congress passed the Fair Debt Collection Practices Act to protect consumers from some of the most offensive collection tactics. The FDCPA protects debtors from harassment, public embarrassment, and unfair collection practices. It doesn’t stop debt collectors from collecting debts, but it does set reasonable limits on how and when they can attempt to collect debts.

The FDCPA applies to outside collection agencies, not internal debt collectors. If your credit card issuer or another lender is trying to collect the money you owe them directly, then this law does not apply. (There may be state laws, however, that apply to the creditor’s activities.) If your card issuer, instead of using its own name, uses a name that would make someone think it is an outside collection agency, it would be covered by this law.

Debt collectors aren’t big mean guys who break customers’ kneecaps when they can’t pay. Nevertheless, when you’re in a financial crunch, dealing with debt collectors can be annoying or even frightening. It doesn’t necessarily have to be that way.

Most collectors are professionals and conduct their business in a semireasonable (though often high-pressure) manner. There are some, though, that may use intimidation or illegal tactics to coerce consumers into paying past-due bills. The Federal Trade Commission reports that complaints about debt-collection companies are one of the top three categories by number of complaints.