Roles and Responsibilities of a Debt Collector in Michigan and Myths about Debt Collectors
As household budgets get tighter and the economy tries to get out of its slow down, there is something that most consumers dread. A call from a debt collecting agency asking about some unpaid medical debt, a due past student loan, utility bills or an unpaid credit card debt. How many of you have had encounters with debt collectors? How would you describe the experience? Perhaps some of you may never wish to remember the experience, especially; if it was an encounter with a debt collector that lacked courtesy, was a fraud or worse: one that ended in courts with a legal suit filed against you. I am going to briefly highlight the current problematic issues within the debt collection business that arise due to lack of knowledge about debt collection and debt collectors.
Debt collection agencies run legitimate businesses that provide services that allow creditors and collectors to take the necessary legal steps that can ensure payment or repayment is secured from customers that are legally bound to do so, but have failed to meet the due dates. There are different issues that have recently arisen in the debt collection business. These include a rise in fake debt collection agencies, fraudulent debt collection cases and an increase in law suits filed against debt collectors (Nitzkin n.pag). The legal suits result from violations of debt collection rules and regulations under the Fair Debt Collection Practices Act (FDCPA) and the Fair Credit Reporting Act.
These issues present a two faced aspect of a problem in debt collection. On one side, the rise in legal suits is actually an advantage, isn’t it? Think of it this way: a rise in these suits is an indicator that consumers now seem to be more aware of their rights as well as the roles and responsibilities of the debt collectors. This is depicted by the rise in law suits filed against debt collectors that do not uphold good debt collection practices. On the opposite side, there are numerous people fraudulently losing money to fake debt collection agencies. This is a clear indicator that there are people that do not yet understand the roles and responsibilities of debt collectors as well as the protocols to be followed in business of debt collection (Nitzkin n.pag).
According to a 2009 Federal Trade Commission Annual Report, debt collectors are given the role of making third party debt collection. This should be under an agreement with the creditor that transfers the legal mandate to their respective agencies. This transfer also offers the debt collectors some responsibilities related to the debt collection process. These responsibilities include making the debtor informed of his debt account, and conveying a subsequent demand for payment. The collector also has the responsibility to explain to the debtor the repercussions of failing to pay as well as any legal remedial measures available to the creditor or collector. However, there are restrictions on this; it has to be done in a manner that should not sound threatening or intimidating to the debtor (FTC 31).
So, has any one of you felt threatened or intimidated by a debt collector in Michigan? Well you had the right to file a suit, and now you know what to do next time a collector makes a threatening or intimidating call or note. Notifications on disconnection of utilities such as electricity should be delivered earlier by collectors to the debtors before disconnection. The collector is also responsible for making arrangements for debt repayment as well as designing an alternative settlement proposal and reviewing the current arrangements after the agreed upon period.
The collector also has the responsibility to ascertain why the current repayment arrangement has to be complied with as well as why earlier attempts of contacting the debtor had not been addressed if that is the case. Collectors are also responsible for inspecting, sighting and recovering security interests as well as investigating any debtors’ residential location changes. Beyond these responsibilities, it is totally illegal for a debtor to contact you with an aim of frightening, demoralizing, intimidating or embarrassing you public. Neither should they call you for any similar purpose or make your debt information public (FTC 14).
All said and done, there are also some myths about debt collection and debt collectors in Michigan and all over the nation at large. Some of these myths may lead to poor decision-making when handling debt collectors and finally lead to more trouble. Myth one; most people believe that they are entitled to a bill sent by the debt collector. All that the Fair Debt Collection Practices Act demands is that a debt collector sends a first collection notice to the debtor’s last known address. The “I did not get the bill!” does not work, and collectors may take that as “stalling” and as a result they may proceed with any action under their legal mandate.
You may be entitled to a bill by law, but it does not mean you will get one if you ask one from the collector-unless you send a written request, that may not be used as an excuse (Wilson n.pag). Other people also believe that if they tell a collector to stop calling, that indeed they will stop. Wrong! All that the act states is that they should only avoid calling your work place if you request. However, if you require them to stop; you have to write a ‘cease and desist’ letter and ask all communication to be directed to your attorney. Finally, other people think that debt collectors cannot call their cell phones. This too is a myth, because they cannot stop even at your request-unless they acquired your number from another source other than the creditor (Wilson n.pag).
As consumers, we would like our debt repayment and interaction with debt collectors to be smooth. However, this may not be possible if consumers do not learn about their rights and the responsibilities and roles of debt collectors. Therefore, in order to ensure smooth dealing its prudent for every debtor to know where they stand and their legal rights as it pertains to debt collection. As a result, every individual debtor should take their own time to learn about the debt collection business. This will in turn compel the debt collectors to comply and follow proper regulations and procedures in carrying out their business.
Works Cited
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