Debt Collectors – What They Can and Can’t Do

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There are few calls that elicit as much dread and frustration as a debt collector. Yes, even more than those extended car warranty calls! While it’s probably not a number saved in your phone, you know who the number belongs to. Each time it calls you get that sickly feeling – fear, shame, anxiety, anger, and annoyance. We’ve all been there at some point, for one reason or another, and besides calling constantly, you may or may not be aware that there are some rules that debt collectors do have to follow.

There are about 70 million people who currently have bills in collection and routinely get calls from debt collection agents. These agencies are supposed to follow the guidelines set under the Fair Debt Collection Practices Act (FDCPA), but like most people, you’ve probably never read them to know what’s allowed and what’s not. Don’t worry, Litchfield Bancorp – A Division of Northwest Community Bank is here to help you so you don’t fall prey to any schemes or tactics.

How do Debt Collectors get my info – is it legal? Yes, it is legal. Creditors like credit card companies, mortgage lenders, hospitals, etc. sell your debt to a collection agency typically for pennies on the dollar. Now the debt collector owns your debt and is tasked with contacting you to collect on it and recoup their costs and hopefully turn a profit. While this process is legal, they are not allowed to harass you or threaten you to collect that debt.

Can Debt Collectors call my work? This can be very humiliating and feels like a line has been crossed, but what they are doing is not legal. Although you do have rights when it comes to them contacting you at work:

  • Debt collectors cannot come to your place of employment. It’s illegal.
  • The FDCPA prohibits debt collectors from sharing information about your debts. They can’t disclose who you owe money, the amounts, when it became delinquent, or any other information including payment history.
  • While they can call you at work, they are not allowed to identify themselves as a debt collector to the person answering the phone.

You are within your rights to ask them to stop calling you at work, and by law, they must oblige.

Can Debt Collectors contact my family? Debt Collectors will use any information they have about you to track down debt, including calling family members. Again, they can’t reveal why they are calling and they are legally only allowed to call a family member once. If they repeatedly call them or disclose any information, you are within your rights to report them to the state’s attorney general or the Department of Consumer Protection. Keep in mind that debt collectors can legally discuss your affairs with certain people:

  • Spouse
  • Parent (if you are a minor)
  • Guardian or executor
  • Your attorney if you have one representing you

Can a Debt Collector refuse a payment plan? Yes, they are not required to negotiate with you. The Debt Collectors’ goal is to collect as much money as fast as possible. A long-drawn-out payment plan may not be an option. However, Debt Collectors typically operate under the motto that something is better than nothing, so you may be able to work out some terms that benefit sides. Before you send any payments, make sure you have everything in writing confirming what you owe to make sure it’s accurate. If it is, coming up with a debt settlement plan may be your best option to reduce some of your debt.

Can my wages be garnished? No, a debt collector can not have payments directly deducted from your paycheck unless they take you to court and the order is granted by a judge.

How do I know if I’m being harassed? Dodging a debt collector can be a full-time job until you have the funds to pay off the debt. Yes, they have a right to their money, but they don’t have the right to harass you, threaten you, or disclose your personal information to everyone that knows you. If a debt collector does any of the following, report them to the state’s attorney general or Department of Consumer Affairs:

  • Calls you before 8 a.m. or after 9 p.m. in your time zone
  • Makes repeated daily calls
  • Sends multiple letters
  • Threatens legal action repeatedly
  • Uses abusive or obscene language
  • Publicizes information about you or your debt
  • And starting in late 2021, debt collectors will also be able to contact you via text, email, and social media, so look out for abusive or harassing outreach attempts there too.

While you have every right to request a debt collector stop contacting you, that won’t make the debt go away. The debt you owe does need to be addressed and simply not responding will not make the debt disappear. Getting into debt doesn’t happen overnight, neither does getting out of it. Don’t lose hope though because thousands of people pay off debts every day.  


Stephen Yonych Jr.
Assistant Vice President, Watertown Manager
MLO# 701846

Author: Stephen Yonych

A recent addition to the Litchfield Bancorp Retail Banking Group in Watertown. Steve has spent the past 6 years in retail management & lending. Steve lives in Cheshire and has been actively involved with many community organizations including the Waterbury Chamber of Commerce, Leadership Greater Waterbury, the Lyons Club, the Crime Stoppers of Water-Oak and the Greater Waterbury Board of realtors.