Know your Rights When Dealing with Debt Collectors

Debt collectors have a reputation—and in some cases, a well-deserved one—for being unpleasant and even threatening when trying to get debtors to pay. Even though the Fair Debt Collection Practices Act (FDCPA) was enacted to limit debt collectors’ behavior and actions, some collectors continue to ignore the law.

Understanding the boundaries of debt collectors will help you to better deal with them. Here are some general guidelines to keep in mind.

False or Misleading Representations

The FDCPA prohibits debt collectors from pretending to work for any government agency, including law enforcement.

A recent documented case involved the sentencing of debt collectors for allegedly accusing people of fraud, stating they would be arrested and face criminal charges for not repaying debts. The collectors also allegedly misrepresented themselves as contract workers for federal and state government agencies, including the Department of Justice and the U.S. Marshals.

Arrest Threats

Federal debt collection law prohibits collectors from falsely claiming you’ve committed a crime or will be arrested if you don’t repay the money they claim you owe. Collection agencies cannot issue arrest warrants or have you put in jail. Failing to repay a legitimate credit card debt, mortgage, car loan or medical bill won’t get you a jail sentence.

However, if you do receive a legitimate court order to appear in court related to a debt you allegedly owe, and don’t show up, the judge could issue a warrant for your arrest. Additionally, if you fail to pay a court fine related to your debt—or refuse to pay taxes or child support—you could go to jail.

Publicizing Your Debt

Debt collectors are not allowed to contact you by postcard, publish the names of debtors who refuse to pay them or talk to anyone other than you, your spouse or your attorney about your debt. Additionally, debt collectors should not try to publicly shame you into paying money that you may or may not owe.

Debt collectors are allowed, however, to contact third parties to try to track you down and ask for your address, home phone number and place of employment – although they’re not generally allowed to contact such people more than once.

Attempting to Collect Debt You Don’t Owe

The Fair Debt Collection Practices Act requires collectors to send you a written notice stating how much you owe within five days after first contacting you, including who they claim you owe and how to make your payment.

In some instances, debt collectors may rely on incorrect information when attempting to collect on an unpaid debt. For example, the agency might be trying to collect a debt from you that was discharged in bankruptcy or that belongs to someone else with an identical or similar name. If you are uncertain about a debt owed, send a letter to the collector via certified mail with a return receipt requesting more information. Meanwhile, do not assume any responsibility for the debt.


Debt collectors cannot:

  • Threaten you with violence or harm
  • Use obscene or profane language
  • Call you repeatedly
  • Call you before 8:00 a.m. or after 9:00 p.m. without your permission
  • Call you at work, if you disallow it in writing
  • Contact you at all—if you tell the collector, in writing, to stop contacting you altogether or to contact only your attorney

Debt collectors may contact you to let you know they will no longer be contacting you, or to inform you that a lawsuit has been filed against you.

And here’s a special note to people wondering how to pay of credit cards or who need credit card help: In-house debt collectors are not subject to the FDCPA. Consequently, if you are delinquent on your Chase credit card bill and Chase calls you directly, they are not required to follow the rules described in the FDCPA. Only when a collection agency or debt buyer is involved does FDCPA apply. Also, if you receive a court summons for a lawsuit regarding your debt, don’t ignore it—it might be legitimate. When in doubt, be sure to check out the court contact information to ensure the summons is real and not a forgery.

The Bottom Line

The Fair Debt Collection Practices Act was enacted to protect your rights as a consumer—so don’t allow a debt collector to ever intimidate or harass you!You can contact one of our Consultants at 1-888-910-8411 to learn more about resolving burdensome credit card debt, debt settlement, debt management and other debt relief programs.

Financial Institutions – Friends or Foe

Regardless of our age, we’ve heard, read, or even seen movies about The Great Depression, which began in 1929 and continued until the late 1930’s. And although The Great Depression had its origins in the United States, it was global in nature—causing a severe worldwide economic downturn. Unemployment, for example, rose above 30% in some countries.

When the Great Depression began, people with investments in the stock market lost nearly everything, sending some into bankruptcy. By 1933, bank depositors saw $140 billion disappear due to bank failures. Not until the FDIC (Federal Deposit Insurance Corporation) was created in 1933, which guaranteed the safety of a depositor’s accounts in member banks for up to $250,0000, did the average consumer have any assurance (or in this case, insurance) that money deposited in a bank would be there when they wanted to withdraw it for personal use.

Following the Great Depression, an entire generation of people had little or no faith in banks. There was a growing skepticism that banks didn’t exist for the average person and that they operated under the notion that the consumer was there to serve them – not to fund them. And unfortunately, there’s certainly some truth to this.

Many years have passed since the Great Depression and new laws like the Fair Debt Collection Practices Act have helped to protect consumers—on both the lending and borrowing side. Despite this, banks and other publicly owned financial institutions are (still) in the business of maximizing profits because they have a responsibility to their shareholders to do so.

Finance companies are (really) not your friend

The financial industry (e.g., banks, credit card companies, and finance companies) are institutions that you need to have faith in. Most of us need a loan every now and again to purchase a car, home, or consolidate debt. We need a credit card for unplanned necessities. But be aware that these institutions only want your hard-earned cash and are willing to spend an incredible amount of time, effort, and money developing ways to separate you from it. If you are not careful, you’ll soon find yourself looking for debt relief options. It’s no wonder that the average indebted household carries over $15,000 in credit card debt.

The marketing strategies employed by many financial institutions push all of the emotional consumer buttons when selling their “products.” You’ve heard or seen it before. The pitch is usually: “you owe it to yourself, take your family on that long-deserved vacation, “zero percent interest, or no interest for 12 months.” How about the catchy slogans: “what’s in your wallet,” “it pays to Discover,” or “don’t leave home without it”? Essentially, these institutions want you to feel good about borrowing and using their money because it leads to paying interest and fees—which is how they make their money.

Sadly, many consumers continue to borrow more than they probably should and eventually need credit counseling and repair, credit card help or even debt settlement services. Before they realize it, their wallets are being drained by overdraft protection, late payment fees and even increases in their interest rate. People who make the mistake of doing business with a pay day loan, cash advance, or title loan operation, could end up paying as much as 300% in interest! Talk about the need for a debt relief program.

One of our Founding Fathers, Thomas Jefferson, had something to say about the banking institution:

“I believe that banking institutions are more dangerous to our liberties than standing armies. If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and corporations that will grow up around the banks will deprive the people of all property until their children wake up homeless on the continent their fathers conquered.”

That warning is just as appropriate today as it was over 200 years ago.

Here are two words that every borrowing consumer should always live by:

Caveat Emptor, which means “buyer beware.”

If some of these practices have left you wondering how to get out of debt, you can contact one of our Consultants at 1-888-910-8411.

6 Secrets Credit Card Companies Don’t Want You to Know

If you think about it, you’ve got a close, intimate relationship with your credit card. Both of you have been inseparable through each daily transaction. You treat it right by paying your monthly minimum payment on time. You know all your card’s intimate details, such as its credit limit & interest rate, right down to memorizing every reward point. Most likely, you even know your card number by heart. Unfortunately, there’s some bad news — terrible enough that once you hear it, you may be forced to break it off with your Creditors once and for all:

Your credit card companies have been holding out on you.

The fact is, you’ve been kept in the dark about several secrets because your financial benefit comes at your card issuer’s financial loss. Here are some of the things your creditors do not want you to know – secrets that offer real credit card help.

  1. Fixed rates aren’t really fixed. Issuers can raise your APR whenever they choose. This information isn’t necessarily a blatant secret, but it’ll be hidden to sign on with a fixed introductory interest rate that may change at the company’s will. You have the right to be notified 15 days before a potential rate increase.Tip: To stay on top of potential rate increases, check your mail; you’ll receive notifications in a thin, discreet white envelope.
  2. One late payment … two penalties. In a perfect world 1 late payment = 1 penalty fee; ontime payments equal zero fees. In this imperfect world, you can be penalized with two surcharges on one delinquency, and you won’t know about them until you’ve been charged. These can come in the form of a late fee (up to $35), and a penalty rate – a permanent interest increase that can jack up your APR to as high as 29.99 percent! The 2009 CARD Act sought to place limits on these increases, though the details aren’t widely known by the average cardholder.Tip: Know your payment due date. If it’s getting close, try paying by phone or online.
  3. Twice the interest in one month. Another financial punch comes in the form of a legal maneuver which allows your card company to impose two months’ interest for just one month of late balance payments. For example: you’re charged twice the interest for a partial balance payment in October even though you paid on time in September. Called doublecycle billing, the card issuer looks at your average daily balance over two consecutive months and charges you higher interest based on the month you carried a higher balance. It’s not even the interest that makes this a problem, but the principle of being punished for good financial behavior.Tip: Not every credit card company uses this practice. If yours does, you might want to switch to another one.
  4. Disgraceful grace periods. How many of us who’ve made big-ticket purchases have been thankful for the grace period? Say you charge $1,000 to your card and pay $250 by the due date to hold off your creditors. Most cards carry grace periods up to about 25 days, allowing you to pay off the remainder, interest-free. But in the spirit of profiteering, many providers are reducing the grace period to just 20 days, while some are doing away with them altogether. That means you’ll get charged interest on every purchase, even with timely repayments.Tip: Before snatching up a no-limit card, ask your provider if the limit is predetermined, and be careful not to spend beyond that amount.
  5. No card limits – just with limits. Many consumers in possession of a no-limit credit card discover they have a revolving spending cap – let’s use $5,000 – but only learn of it after racking up $7,000 in purchases, leaving them stuck with a remaining $2,000, plus interest, to pay off. Why is this so? Your card company advertised your plastic as no limits, but it’s really set at a no preset limit, based on your own month-to-month spending and behavior patterns.Tip: Avoid this fall from credit grace, and check how many grace period days your credit card company offers.

Minimum payments to the maximum. It’s the nature of the credit beast: The longer you stay in debt, the more interest credit card companies can charge, and the more money they make. In the past, card holders had a five percent minimum monthly payment. This became problematic for creditors because people were motivated to pay off their balances more quickly. So they lowered the monthly minimum to two percent. But now, with smaller repayment requirements, we’re prone to spend more and accrue more debt each month. Experts maintain that this move by card companies adds thousands of dollars in interest, creating a repayment schedule that could last years, if not decades.Tip: Whenever possible, pay more than the monthly minimum due.


While debt relief programs won’t suddenly erase your debts, they can help you take steps to reduce or eliminate your debt over time. Consider working with a debt relief company to negotiate with creditors on your behalf and potentially get your debt under control.

  • Do you have a large amount of unsecured debts like credit cards or medical bills?
  • Are you only able to make minimum payments due to finances being stretched too thin?
  • Is your debt causing concern, stress, or panic?

A debt relief program may be right for you.


  • The debt relief company works with you to select the right debt relief options for you.
  • A debt relief company may negotiate with your creditors on behalf of you to reduce or eliminate your debt.
  • Consolidate multiple monthly payments down to one single monthly payment.
  • Although debt relief isn’t a magic solution to getting out of debt, it can cut through the chaos of due dates and collections calls.



  • Takes multiple debts and combines them into one loan.
  • Debt consolidation loans work best if you have:
    • Steady income
    • Discipline to not take on more debt
    • Good credit
  • Consolidating debt loans can reduce the stress of multiple payments, due dates, and creditors. You’ll only have to worry about making one payment.


  • Debt settlement can reduce the total amount of money you owe.
  • A special debt settlement account is set up in your name. You’ll make monthly deposits to the account so the funds grow over time.
  • The debt settlement company negotiates with your creditors to reach a legal agreement to settle your debts.
  • Debt settlement is the preferred option for many people who are not qualified for additional financing products.


  • Typically, credit counseling is a free resource provided by nonprofit financial education organization.
  • A credit counselor will work with you to help you improve your individual financial situation.
  • They may offer tools and resources to help you gain control over your money.
  • You may have fees reduced, but credit counseling doesn’t usually reduce the total amount of debt you owe.


  • Used only if no other debt relief plan is possible.
  • In rare cases, bankruptcy may completely remove your debts. However, there are high legal and court fee costs to bankruptcy so you will likely still need to pay a hefty sum.
  • Bankruptcy can stay on your credit history for up to a decade and make it difficult to get approved for mortgages, car loans, and other credit accounts for years to come.
  • Many bankruptcies end with a creditor recouping some of the money you owe by liquidating your assets.


Planning to consolidate your debt? You might be worried about what consolidation could do to your credit score. It’s common for many people to see their credit scores decline when they consolidate debt, at least in the beginning. As you pay down debt and reduce spending, you’ll probably see your score begin to climb.

Watching your score slowly increase and worrying that it might drop again is frustrating. Help yourself avoid some of the credit woes that go with debt consolidation by making these smart credit moves.


After paying off some of your debt, you might be tempted to close accounts that have a zero balance. You’ve finally gotten rid of that debt, so why would you want to keep the account around?

Surprisingly, closing your old credit cards or loan accounts could cause your credit score to fall. This happens because the length of your credit history is important to your score. A longer credit history indicates to lenders you have experience borrowing and repaying debt. This is shown on the report based on accounts that are open.

It’s usually better to keep your accounts open, even if you’re not using them. In order to improve your credit score when consolidating debt, an open account with zero balance can have a positive effect on your credit score.

The exception to this tip is if you’ve consolidated credit cards that have an annual fee or if you are unable to curb your spending. Credit cards that charge an annual fee will almost always still charge you the fee regardless of if you’ve used the card or not. The positive effects to your credit score may not make up for the money you’re losing.

Additionally, if having a credit card or other account with a zero balance makes you want to start spending, it might be better to close the account. You could potentially avoid overspending by eliminating payment methods.


Credit utilization is the amount of credit you’re currently using versus the amount of your credit limit. The closer you get to maxing out your available credit, the riskier you look to lenders. Having more available credit generally shows that you’re responsible with your credit usage and spending habits.

Credit usage is a huge factor in your credit score. It’s generally recommended that you use no more than 30% of your credit limit across accounts. The more you can keep your balances below that rate, the more likely you’ll see your score go up.


Applying to new loans, credit cards, and other credit accounts all at once could quickly drop your score. When you apply for a new account, lenders will make what’s known as a hard inquiry on your report. This inquiry can drop your score temporarily. Generally, a hard inquiry disappears from your report after about 24 months.

Since hard inquiries expire, applying for one account may not have a huge effect on your score. Applying to multiple credit accounts at once, however, can drop your score by quite a bit. It’s best to avoid applying for any new credit when you’re in a debt consolidation program. If you absolutely must apply for credit, make sure you look into your chances of approval before actually applying.


Monitoring your credit report helps you potentially catch unauthorized accounts or identity theft. If you notice a strange account or application on your report, you can take measures to report fraud. It’s usually much easier to stop fraud by catching it early than it is to repair your credit after extensive fraudulent activity.

Checking your score may also help improve your credit score when consolidating debt by allowing you to make changes in the way you’re managing debt. You should compare your score with past scores to see if it is moving up or down. If it’s improving, you know you’re on the right track and should keep doing what you’re doing. If you see it decreasing, it may be time to make changes to your credit and debt habits.


A frustrating aspect of increasing your credit score is the time it takes. Unfortunately, credit scores usually take several months to years to see a significant improvement. Being patient is an important part of building a good credit score.

As you try to improve your credit score, focus on making your consolidated monthly payment so you have a better chance of successfully completing your debt relief program.  You can utilize these tips to help improve your credit score.If you’re considering consolidating your debts with a debt relief program, you probably have a lot of questions. The Accredited Debt Relief Team is here to help answer those questions and give you professional advice on debt relief. Get a free consultation today to learn more.