If you’re behind in your payments, no doubt you’ve been getting a few calls from collection agencies. I’ve received letters from people who have completely stopped answering their phones because they can’t stand the calls. Hey, if there are people to whom you owe money, your “creditors” have a right to try and collect that money. Even so, there are definite rules that collection agencies must follow. If you know what collectors can and can’t do, you’re in a better position to deal with them.
The legislation governing collection agencies is provincial, so the rules are slightly different from one provance to the next. I’m using the Ontario rules as my examples.
Collection agencies can’t start calling until they’ve notified you in writing that they’ve been assigned to the account. I’ve received more than a few complaints from people who say that some agents won’t say who the creditor is or how much is owed. They aren’t allowed to do this. And if you claim to not owe the money, they can’t demand payment from you unless they have proof that you do owe the money.
Collection agencies aren’t allowed to harass you. Believe it or not. That means they can’t call and abuse you verbally or call you so often as to make you crazy. What constitutes harassment? Agents can’t contact you by any means including phone, voicemail, or e-mail more than three times in any seven-day period on behalf of the same creditor. They’re not allowed to call on a statutory holiday, on a Sunday before 1 p.m. or after 5 p.m., or on any day before 7 a.m. or after 9 p.m. And they may not contact your friends, relatives, neighbors or employer for any information other than your address or telephone number.
Feel like you’re being harassed? Keep a record of the time, date and frequency of the calls your receiving. Remember each call for a separate debt is considered a separate call, so if an agency calls you six times in a day for six different bills that have gone to collections, they’re not offside.
The best way to deal with a collection call is to speak to the agent straight-up and professionally. Remember, they’re doing a job, and no matter how much you hate the job they’re doing, they’re just people like you. The sooner you pay the bill, the sooner you’ll make the collector go away. Can’t pay the bill off all at once? Explain why and offer some alternative method of repayment, like a series of monthly payments. Follow up in writing and make sure you send a good-faith payment.
Do I actually have to say that you should never ever send cash. You need to have some proof of payment; a canceled cheque or a receipt from the collection agency works fine.
Don’t let them bully you. Yes, some do try. You don’t have to make any commitment you don’t think you can keep. And you should only say yes to things you’re actually going to do. Saying yes to get them off the phone just means they’ll step up their calls. Ignoring a collection call won’t make the problem go away. If a collector gives up on trying to work out a plan with you, they’ll simply take the next step, which is legal action. And judgements against you show up on your credit history, and stay there for a looong time.
One question I get quite often is this:
“Do I have to deal with the collection agency or can I deal with the company I owe the money to directly?”
I have some bad news for you. Once the account has been turned over to an agency, they are the only ones you can deal with. If you try to contact the original creditor, you’ll just create confusion. The exception: if there’s an error in the account you need to deal with both the creditor and the collection agency, and you should do it in writing so you have a paper-trail.