Recycling my post from when this link was submitted 32 days ago.
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While I highly encourage everyone to read this in its entirely, I think it's worth a quick summary of the bits that may be personally-useful to those who don't:
* If it comes to a lawsuit in a court case, DO NOT IGNORE IT. If you don't show up, collector gets a kind of automatic win called a default judgement, and that's how you end up losing your house or having money vanish from your bank-account. If you do show up, they might instantly offer you a discount deal, often because they know their position is very shaky and they don't actually want to spend money fighting a court case that might be unwinnable against a strong opponent.
* Ask for proof. Debt collectors often lack documentation that you are legally-entitled to. ("Debt verification" under the "FDCPA".) Many never got it form the original bank, and don't want to spend time/money getting it. Asking for that proof means they may just give up and move on to a cheaper/easier person.
* Don't be fooled into paying for other people's debt. At least in the US, debts end when the original debtor dies, except in the sense of money taken away from the debtor's stuff before it reaches heirs. You can't ever "inherit negative money". Spousal stuff is more complex, but don't get fooled into paying something you don't even owe.
* Debt collectors will often make threats that are both impossible and illegal. This means you can only benefit from having everything in writing. (Or by clearly announcing that you will record a call, and then recording it.)
* The law (FDCPA) only allows debt collectors to call family members in order to get your contact information... But some of them use this as a form of harassment/coercion. There's no magic-wand for this part.
* If you agree to a vague "payment plan" and then send them the first check or bank-account info, watch out: Even if you don't write another check, they will find ways to withdraw money out of that account at the exact worst moments for you... but the best for them.
I'm in Canada so laws are different but what I found here is when I ask for proof they don't send it, they just sell the "debt" to a different agency and then I start getting harassed again 2 months later, rinse and repeat.
(I put debt in quotes because the alleged debt is with a company I've never done business with, so I assume it's completely fake, mistaken identity, or identity theft.)
I got one that must have been mistaken, sent off the letter asking for evidence and it shows up from a new guy instead. Same letter to the new guy, it never returned.
There is one simple change I would like to see to the industry--if a debt is challenged it should be illegal to sell while the challenge clock is running and if it's not substantiated it should be illegal to sell, period. You should not have to play whack-a-mole with bogus or mistaken identity debt.
I would also like to see the FDCPA remedies applied to everyone--you should have the same causes of action even if it's not your debt.
Just an FYI it is illegal if you ask. Or something like that IANAL. The author of the original article has a “what letter to write to debt collectors” article and basically says something to the affect of
“Please provide me proof that this debt is valid. Or else please notify all credit agencies that this debt is invalid and should be scrubbed. You are not allowed to sell or collect on this debt until you tell me it’s real”.
Of course doesn’t mean people follow the law. But sometimes you have to have intention in explicitly asking them to delete the record if they don’t have proof.
_____
While I highly encourage everyone to read this in its entirely, I think it's worth a quick summary of the bits that may be personally-useful to those who don't:
* If it comes to a lawsuit in a court case, DO NOT IGNORE IT. If you don't show up, collector gets a kind of automatic win called a default judgement, and that's how you end up losing your house or having money vanish from your bank-account. If you do show up, they might instantly offer you a discount deal, often because they know their position is very shaky and they don't actually want to spend money fighting a court case that might be unwinnable against a strong opponent.
* Ask for proof. Debt collectors often lack documentation that you are legally-entitled to. ("Debt verification" under the "FDCPA".) Many never got it form the original bank, and don't want to spend time/money getting it. Asking for that proof means they may just give up and move on to a cheaper/easier person.
* Don't be fooled into paying for other people's debt. At least in the US, debts end when the original debtor dies, except in the sense of money taken away from the debtor's stuff before it reaches heirs. You can't ever "inherit negative money". Spousal stuff is more complex, but don't get fooled into paying something you don't even owe.
* Debt collectors will often make threats that are both impossible and illegal. This means you can only benefit from having everything in writing. (Or by clearly announcing that you will record a call, and then recording it.)
* The law (FDCPA) only allows debt collectors to call family members in order to get your contact information... But some of them use this as a form of harassment/coercion. There's no magic-wand for this part.
* If you agree to a vague "payment plan" and then send them the first check or bank-account info, watch out: Even if you don't write another check, they will find ways to withdraw money out of that account at the exact worst moments for you... but the best for them.