Unlawful or Harassing Debt Collection

If you use credit cards, owe money on a loan, have outstanding medical bills or are paying off a home mortgage, you are a “debtor.” If you fall behind on your payments to these creditors, you may be contacted by a debt collector. You should know that the Federal Fair Debt Collection Practices Act (“FDCPA”) and various Michigan laws provide protections guaranteeing that debt collectors treat you fairly. Personal, family and household debts are covered under the Federal Fair Debt Collection Act.

The FDCPA prohibits third-party debt collectors from employing deceptive or abusive conduct in the collection of consumer debts incurred for personal, family or household purposes. This Act does not pertain to financial institutions that collect debt that they originated. Generally, such collectors may not contact debtors at odd hours, subject them to repeated telephone calls, threaten legal action that is not actually contemplated, or reveal to other persons the existence of debts.

A debt collector is legally required to stop contacting you if you send a letter to the collection agency telling them to stop. Once the agency receives your letter, it may not contact you again except to notify you that some specific action will be taken. You may be able to sue a debt collector who violates this rule or other rules provided by the FDCPA.

A debt collector may not contact you if, within 30 days after the collector’s first contact, you send the collector a letter stating that you do not owe the money. If, however, the collector sends you proof of the debt, such as a copy of the bill, the collector can resume collection activities.

If you owe several debts, any payment you make must be applied to the debt you choose. A debt collector may not apply a payment to any debt you believe you do not owe. You have the right to sue a debt collector in a state or federal court within one year from the date you believe the law was violated.