A lot of people in America get sued by collection agencies because they did not complete a payment or are in a lot of debt. What adds to this is that when the collection agency directly sues the debtors, in most cases it results in the victory of the collectors. Because normally, debtors do not have lawyers, and moreover, they cannot attend the hearing because of work commitments or another matter.
And now, with the outbreak of the corona virus pandemic, people are unable to pay their bills due to unemployment and downfall in the economy more than ever. During these difficult times, it is not appropriate for companies to force the customers to pay their debts. Therefore, a lot of banks and money lenders have been waiving the interest and extending the time to pay back. Various states have also stopped debt-collections suits temporarily.
But what can you do once the economies open and the emergency measures stop?
Know Your Rights
Every debt collector has to abide by the laws under the Fair Debt Collection Practices Act.
- This act prohibits debt collectors to use abusive or foul language when calling you for debts.
- They are also not allowed to use deceptive tricks and pretend to be someone else on call.
- The Consumer Financial Protection Bureau has limited the number of times your collector can contact you via phone calls.
- During the pandemic, states have added more safeguards like, the collector cannot file a lawsuit against you or call you repeatedly.
Moreover, you also have the right to verify whether a debt is yours or not.
Can Stimulus Payments Get Garnished?
Taking stimulus payments to cover the state debts or federal debts has been exempted under the federal virus relief programs. However, it does not provide protections for the funds from private debt collectors. A few states have although protected the stimulus payments to a great extent during the pandemic.
In case your payment gets seized, you can appear in the court to fight for it, but it can get challenging because of the pandemic.
What To Do if a Debt Collector Contacts You?
Whenever a collector calls you, the first thing you should do is to confirm that the call is from an authentic debt collection agency. You can ask for details like name of the company and address.
During the pandemic, if you are unable to pay the debt, you can talk to your collector and try to figure out better payment plans. There may also be hardship programs that can suspend your payments for a while.