What To Do When a Debt Collector Calls

Answering a call from a debt collector can throw your day off track with the new responsibility of resolving a financial issue. Yet it's a fairly common occurrence.

"It's a natural emotional reaction to get scared, almost like you're getting pulled over," Leslie Tayne, founder and debt relief attorney at Tayne Law Group, P.C., told The Balance. However, "the first step is not to panic."

Learn how to take control of the conversation and steer it toward the best outcome for your finances.

Know Your Rights as a Debtor

As someone with debt, you have a significant amount of protection from federal laws such as the Fair Debt Collection Practices Act (FDCPA), which regulates debt collection activities. The Federal Trade Commission (FTC) fields debt collection complaints from consumers regarding deceptive, unfair, or abusive debt collection practices. It offered nearly $5 million in refunds to victims of unfair debt collection last year and banned 17 debt collectors from the business after serious and repeated violations of the law.

As a debtor, your rights include the right to hire an attorney, the right not to be sued after a period of time, the right to ask debt collectors to stop calling, and the right to file a complaint against them.

Hire an Attorney

When you are facing debt collection, you can contact an attorney to help you navigate the process of settling the debt with the collectors. "Collection matters are legal matters," Tayne said. "If it's uncomfortable, definitely reach out to a lawyer." Once you hire an attorney, the debt collector must contact the attorney, not you.

If you don’t handle debt collectors correctly, you risk giving up some of your rights. However, if you're confident and you aren't facing a large or complicated debt, you may want to handle repayment or negotiation on your own to resolve the issue.

You Can't Be Sued for a Debt After a Certain Period of Time

The last resort for a lot of debt collectors is suing you, which can have significant negative consequences for your credit. However, after a certain period of time known as the "statute of limitations," debt collectors lose the right to sue you. The statute of limitations for collecting debt is usually around three to six years, but it varies depending on state law and the type of debt.

After that, the debt becomes "time-barred," and debt collectors can't sue you for it anymore.

Ask Debt Collectors To Stop Calling

You're generally in control of when and where debt collectors contact you. If you don't want them to call you, or you want your attorney to handle things for you, you can ask.

Keep in mind this doesn't stop collection efforts, and debt collectors will still be allowed to reach out to you for certain things like notifying you that they're suing you for the debt.

File a Complaint

If you think a debt collector is stepping outside their bounds, you can report them. Here are some agencies that accept complaints about debt collectors:

• Federal Trade Commission (FTC)
• State Attorney General’s Office
• Consumer Financial Protection Bureau (CFPB)

What Can a Debt Collector Do?

Debt collectors may have regulations to abide by, but they have rights as well. By law, they can contact you within limits, provide you with information, and try to collect time-barred debts.

Debt Collectors Can Contact You, Within Limits

Debt collectors are allowed to reach out to you by phone, mail, text message, email, social media, and even in person. They can also contact people you might know in order to find you, although they're not allowed to tell them the purpose is for collecting a debt.

Even so, there are plenty of limits on how debt collectors can contact you. Debt collectors cannot:

• Lie to you
• Threaten, harass, or swear at you
• Call you before 8 a.m. or after 9 p.m.
• Call you more than seven times in a seven-day period
• Talk to anyone besides you, your spouse, and your lawyer about your debt
• Send you letters that make it easy for people to know it's from a debt collector

However, aside from these restrictions, debt collectors may contact you. The rule that prohibits them from contacting more than seven times within seven consecutive days also only applies to phone calls. It doesn’t apply to other forms of communication such as emails or texts.

Debt Collectors Can Provide You With Information

Debt collectors can provide you with information about the debt and about any actions they are taking. In fact, if you request the information, debt collection agencies must provide you with "validation" information proving that you owe the debt. This includes:

• How much you owe
• Your original creditor (i.e., the business that passed the debt off to the collection agency)
• A notice of your rights under the Fair Debt Collection Practices Act

By law, they either have to tell you this over the phone or send you a letter within five days of reaching out to you.

Debt Collectors Can Try To Get You To Pay Time-Barred Debts

If the statute of limitations has passed on a debt that you owe, debt collectors aren't allowed to sue you for it; however, they can keep trying to collect what you owe in some states. 

"Don't promise any payments, especially if you're not sure about it, even if they say 'give us $5 or $10,' " Tayne said. “From a legal perspective, you can be interfering with your legal rights by actually making a payment." In some states, even acknowledging that the debt is yours can be enough to restart the clock on the statute of limitations.

What To Do When a Debt Collector Calls

The first call with a debt collector can be stressful because it can catch you off-guard. If you get a call from a debt collector, first determine who they are and which debt they are collecting. Then end the call and verify those details. Here are some other common steps to take in a debt collection call:

1. Decide if you want to talk now: Remember that you are in control of the conversation, not the debt collector. "If it's not a good time to talk, ask them to call you back or call them back," Tayne said. That way you can develop a strategy and avoid making costly mistakes.
2. Confirm your name: Debt collectors can't go into any details until they know it's you they're speaking to. If you don't confirm your name, you can't get any information.
3. Don't provide any more details: Just because someone calls you and knows your personal details, it doesn't mean it's a legitimate call. Don’t provide personal details outside your name.
4. Ask for the debt collector's contact information: Scammers can pretend to be debt collectors, which is why you need to vet them. Ask for the debt collector's name, the company they're with, and their contact information. "Don't call the number back, because the number can go anywhere," Tayne said. Instead, research the company online, then call the company directly and ask if it has an account in your name.
5. Ask for details about your debt: Not all debts are real, especially if there was a reporting error or someone stole your identity. Ask about the debt amount and the original creditor, then reach out to the original creditor to confirm that it's a real debt and that they handed it off to the collection agency.
6. End the call to check the information: Let the debt collector know you'll need to verify the details on your own before proceeding. Don't agree to make any payments, and don't provide any more information.
7. Determine an action plan: If it's a fake debt, reach out to the authorities. If the debt is real, make sure you're not past the statute of limitations. From there, you can decide whether and how to work with the debt collector to pay it off, including whether you want to hire an attorney.

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