The Importance of Understanding Credit Laws

The Federal Legislation and several other agencies including the Fair Credit Reporting Act (FCRA) were created to protect you from collection agencies and creditors. If you have bad credit, there are steps that you, as a debtor, can take to ensure your credit’s safety.

Remember that you have the right to try to contact you creditor for whatever reason, but if your creditor contacts you after you have asked them not to, they are in violation of your rights. If you write a letter to your creditor asking them not to contact you, under law, they cannot do so. You can also write such a letter if your creditor has filed a lawsuit against you, or if the date is already over.

Of course the best way to get rid of harassing collection agencies is to pay off the debt. If you have debts that are older than seven years, you can, and should, disregard them. After seven years, your debts should be removed from your credit report, and creditors will probably already have written the debts off. If a creditor tries to contact you about a loan over seven years old, do not speak with them.

Collection agencies, under law, cannot correspond with you by mail if they include symbols or labels on the envelope. By law, collection agencies cannot contact your family members about your debt. If you have been subpoenaed to court, collection agencies are not allowed to contact you. Collection agencies are also not allowed to call debtors after 9pm or before 8am. Unfortunately, collection agencies break these laws all the time. Another thing to be aware of with collection agencies is that if you have a lawyer, they are not allowed to contact you personally, and if they do you file a complaint immediately. Also remember that collection agencies are not allowed to contact you at work, unless your employer approves it.

Collection agencies are prohibited from sending letters or making phone calls that give the impression of an official, government contact. They are also not allowed to let anyone from their office impersonate any law enforcement or government officials in an effort to collect a debt. Also a collection agency has no right to give out your personal information. If a collection agency phones your home, they must comply by the law and identify their name and the affiliating company within the first minute of the phone conversation.

Laws have been enacted to protect both the creditor and the debtor. Knowing these laws can help protect your rights and your credit. If you have a credit problem, ignoring it is not going to get creditors off your back. There is always a solution to repairing bad credit, and one step in repairing your credit is to understand and know what your legal rights are.

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