Debt consolidation or legal recovery is a connection between the creditor and the debtor. To act as collector, you need to understand the rules and regulations. You have to really vigilant and record every document. To be a collector is a complicated task. It is risky to get involved in debt collection on your own so you need to follow rules and regulations. There are specific rules about engaging with your clients and how can you say it and how many meeting you can have. There are also rules about collecting and sorting the data. If the debtor asks you to stop contacting then again different rules imply.
There are rules of federal law regarding the collection of debt. Fair debt collection practice act (FDCPA) handles all the rules of debt.
- First if you have debt collection business, then one should know what kind of debts practices are covered by FDCPA. FDCPA covers debt practices of medical, household, mortgage, credit cards and personal use but FDCPA does not cover business debt.
- FDCPA also regulate the timings of calling the debtor. The time is from 9:00 am to 8:00pm. If you as a debt collector contact the debtor at his office then you should immediately stop doing that. Because FDCPA have rules for both parties and ensure decent dealing of debt with multiple easing options.
- If the attorney is representing the debtor then you cannot contact the debtor and interact with attorney directly.
- If the debtor writes you a letter or notice that your agency should stop contacting. Then you should immediately stop contacting and can only reply to ensure that there will be no further contact and also further dealings would be done legally.
- A Debt collector agency on contacting should inform you the total amount you are in debt of. Who is the creditor and how the creditor can take further legal steps. If on meeting the collector does not tells you about this information then his agency should inform in 5 days.
- Also the debtor cannot falsify any statements regarding the money you owe cannot threat to have you arrested.
- If within the 30 days of first communication with debtor you can dispute with the debt asking them to contact you then the debtor agency is not allowed to contact you.
- The debtor agency cannot use harsh and abusive language and give you any kind of threats.