Know Your Rights with Debt Collectors

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Debt collection is a billion-dollar industry that makes calls on more than one-third of the adult population in the U.S.

If the phone rings – and you have legitimately incurred a debt – you are responsible for answering the call and paying the debt. Period.

However, that does not give the collection agency the right to harass, threaten or bully you into repayment, which is how many consumers feel when they get that first phone call.

The polite way to handle things is to contact the original lender to work out a payment plan before things get to the debt collection agency. Don’t wait for the lender to contact you. Don’t ignore their calls or letters. That could harm your credit score. Instead, stop collection calls and work out a way to repay them.

In an ideal world, that’s how you do business. However, when it comes to debt, the world is rarely ideal so it’s important that you know your rights with debt collectors.

Collections Guidelines

The guidelines for debt collection are found in the Fair Debt Collections Practices Act (FDCPA), which was passed in 1977.

Debt collectors are prohibited from:

  • Using abusive language or threatening arrest.
  • Contacting you at work (if you tell them your employer disapproves).
  • Calling before 8 a.m. or after 9 p.m.
  • Contacting others about you (except to verify where you live and work).
  • Revealing to others that you owe money.

In 2021 alone, the Federal Trade Commission issued more than $4.86 million in refunds to consumers harmed by unlawful debt collection practices and banned 17 companies and individuals from the industry for life for engaging in “serious and repeated violations of law.”

Seniors are often targets of such unlawful debt collection practices. For this reason, many of the laws are aimed at protecting the elderly. Learn more about debt protection for seniors.

What to do When Contacted by a Debt Collection Agency

Here’s how to react if you are called or contacted by a debt collection agency:

  • Ask for identification for the person calling, their agency, its address and telephone number.
  • Take detailed notes of all conversations, correspondence and pre-recorded calls. Be sure to note all names, dates and times.
  • Request that all future contact be handled by mail. Send the debt collector all further correspondence by certified mail with a return receipt requested.
  • Ask for all conversations to be followed up in writing.
  • Document any false, misleading or harassing statements. Include them in your correspondence.
  • Ask for full details about any debts that the collector claims you own. Get dates, amounts and the lender’s name.
  • Insist that all communication go through you, unless you hire an attorney.
  • Retain all records indefinitely in case there’s a future dispute.
  • When agreeing to repayment plan terms, have them verified in writing. That includes promises of removing or adjusting reports to your credit history.
  • If you feel you’ve been contacted in error, send a letter disputing a debt in writing. Ask the agency to stop contacting you. If the agency can’t provide proof, you owe the money, by law, they must stop collection efforts.
  • If you don’t owe the bill, don’t pay anything — ever. Even if you’re willing to pay cash so the agency will go away, it’s not a good idea. Payment is considered an acknowledgment that you are responsible.
  • Most importantly, if you owe the money and you’re falling behind, it’s time to meet with a credit counselor from a nonprofit agency. They can help you get caught up and explain the benefits of a debt management program.

» Learn More: How to Negotiate with Debt Collectors

How To Deal with Harassment or Deception

Debt collector harassment — or outright deception — shouldn’t be tolerated by a consumer. Don’t let them intimidate you with unfair and illegal tactics.

What is considered harassment by a debt collector?

Repeated or continuous calls. Debt collectors can’t call you numerous times in a day about an unpaid debt.

Verbal abuse. Threatening or profane language is off limits. No name-calling. No verbal abuse.

Dire threats. Threats of violence, taking away property or having you arrested are not allowed. Debt collectors can’t threaten to sue you (unless they actually intend to file a lawsuit). If a suit is filed and the debt collector wins, the agency will be permitted to garnish your wages.

What Constitutes Deception by a Debt Collector?

Collection agencies must be completely up front in their dealings with consumers.

Under no circumstances are they allowed to:

  • Claim that you’ll be arrested if you don’t pay your debt.
  • Falsely claim to be law enforcement officers.
  • Use a fake company name.
  • Give false credit information about you to anyone, including a credit reporting company.
  • Threaten to seize, garnish attach or sell your property or wages, unless they are permitted by law to do it.

How To Write a Drop-Dead Letter

If you are being harassed by a debt collector for something you do not owe, you should understand that lawmakers never anticipated bill collectors trying to intimidate people who don’t actually owe the debt.

But what if you’re being harassed and you do owe the debt? You still have a recourse.

You have the right to send what’s referred to as a “drop dead letter.’’ It’s a cease-and-desist motion that will prevent the collector from contacting you again about the debt. Be aware that you still owe the money, and you can be sued for the debt.

How aggressive are some debt collectors? They might call your home and tell your kids you’re going to jail. They could call your neighbors and use them to humiliate you into paying. In this modern communication era, some have even stooped to creating fake caller IDs, using the name and number of a relative or local business.

But all of that harassment can be stopped by sending a “drop dead” letter to collection agencies. You can shut them down by using the sample letter below and sending it to the collection agency by certified mail.

Sample Letter to Collection Agency

Date: (list date)
To whom it may concern:

I have been contacted by your company about a debt you allege I owe.

I am instructing you not to contact me any further in connection with this debt.

Under the Fair Debt Collection Practices Act, a federal law, you may not contact me further once I have notified you not to do so.


(Your name)

Account number: (list your account number)

How To Choose What You Pay

If you have more than one debt with a debt collector, you’re allowed to choose which debt your payment should apply to. The FDCPA also forbids the collector from applying the payment to a debt that you disputed.

If you legitimately owe money and want to pay a debt in collections, never give a collector your checking account number over the phone. Pay only by money order. Collectors routinely take more money than they say they will take from bank accounts. Yes, it’s a tough world out there.

Also, never pay ANYTHING until you have a written agreement that states your payment(s) will resolve the debt in full.

How To Get Validation and Proof of Debt

When you are contacted by a debt collector, they are required within five days to notify you in writing with what’s called a validation notice, that you owe money and that you have the right to dispute the validity of the debt. You then have 30 days to send a debt validation letter, requesting proof that it’s your debt.

The 2021 Consumer Finance Protection Bureau Debt Collection Rule has made this easier for you, by requiring all debt collectors to provide a tear-off form with the validation notice that you can use to dispute the debt instead of writing a letter.

The validation notice is also required to include:

  • Debt collector’s name and mail address
  • Original creditor’s name
  • Account number associated with the debt
  • Itemization of current amount of the debt (including interest, fees, payments, and credits)
  • Current amount of the debt as of when the validation notice is sent
  • Information about your rights, including how to dispute the debt

If you don’t dispute the debt within 30 days, the debt collector considers the debt valid. If you dispute it, the collector must stop collection activity after getting your letter or form until they’ve sent the proof.

If the collection agency failed to validate the debt, it is not allowed to continue collecting the debt. It can’t sue you or list the debt on your credit report.

Why request validation, even if you’re ready to pay and you know it’s your debt?

Simple. Debt collectors could send bills for bogus debts, so never assume it’s on the level without complete proof. In the modern information age, it’s easy to gather enough information about a person and their financial dealings to create a fake debt collection notice.

Sad, but true.

You also need to confirm you haven’t already paid. That might sound ridiculous, but some people are more relaxed with verification of their finances. It helps to have proof. It’s good business to force the debt collector to prove the debt is real.

Sometimes debt collectors resurrect old debts and try to make extra money. But with old debts, there’s an excellent chance the collector doesn’t have the original documents proving that you owe.

You should also check to see whether the debt is still within the credit reporting time limit. Debt collections — and other negative information — generally stay on your credit report for seven years from the date of the delinquency. If it’s been more than seven years, it won’t hurt your credit to not pay the debt.

If the debt collection has been verified and falls within the credit reporting time limit, you could settle with the debt collector for a percentage of the amount owed. You might also opt to pay in full, particularly if you plan to apply for a major loan before the debt drops off your credit report.

Either way, you should not ignore the debt. That could damage your credit and force continuous debt collection attempts. It could also prompt a lawsuit.

How To Report Violations

You can report an unethical debt collector or fake debt collection letters to your state attorney general’s office, the Consumer Financial Protection Bureau ( or 855-411-2372) and/or the Federal Trade Commission ( or 1-877-FTC-HELP).

These agencies can intervene if debt collectors are being deceptive or violating your rights.

About The Author

George Morris

In his 40-plus-year newspaper career, George Morris has written about just about everything -- Super Bowls, evangelists, World War II veterans and ordinary people with extraordinary tales. His work has received multiple honors from the Society of Professional Journalists, the Louisiana-Mississippi Associated Press and the Louisiana Press Association. He avoids debt when he can and pays it off quickly when he can't, and he's only too happy to suggest how you might do the same.


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