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Dealing with a Debt Collector – What Are Your Rights?

If you have missed a payment on your credit card, loan or utility bill and have failed to advise the creditor when you will be making the payment, they may pass your outstanding payment onto a debt collector to recover. Debt collectors are usually engaged once a business has exhausted every attempt to obtain outstanding money owed directly from a debtor. While their job is to recover the outstanding funds, they need to act within the law while they do so. Robert Wood and Associates have been servicing clients in Melbourne’s eastern suburbs for over 41 years. Here’s a few things you should know about debt collectors and how to deal with them.

How Can Debt Collectors Contact You?

To recover debts, debt collectors are allowed to contact you by phone, mail, email, social media or by visiting you in person. The first step is usually a letter of demand which is sent by mail or email. They may also reach out to you by telephone, particularly where you have not responded to the initial letter. Keep in mind, they can only telephone you a maximum of 3 times per week and between the hours of 7.30am and 9.00pm on weekdays, and from 9.00am until 9.00pm on weekends. On public holidays they cannot contact you by phone.

Legal Rights When Dealing with Debt Collectors

Under the Australian Consumer Law, a debt collector must not:

• use physical force or coercion
• unreasonably harass or hassle you
• provide misleading or deceptive information
• trespass on your property
• threaten, intimidate or verbally abuse you
• take unfair advantage of any vulnerability or disability

These laws also apply to a debt collector’s conduct towards your spouse, partner, family member or someone else connected with you. They must also protect your personal information. If you believe that a debt collector or creditor has breached privacy laws, or has harassed, intimidated, threatened or abused you, you can make a formal complaint.

What Happens if You Ignore a Debt Collector?

If you don’t have the money available to pay off your debts, it might be tempting to ignore the calls and emails hoping they will go away. However, ignoring debt collectors will lead to serious consequences which may include:

• A negative impact to your credit rating making it difficult for you to apply for any credit or loans in future
• An increase to the original debt
• A lawsuit against being filed against you

It’s a much better idea to focus on settling your debt rather than ignoring the debt collector’s attempts at getting into contact with you. Debt collectors are required to work with you and take into consideration your current financial situation by offering appropriate payment plans if needed. If you are communicative, cooperative and honest about your financial situation you should be able to work with them to come up with a suitable recovery solution.

Let the Legal Professionals Help

Each state and territory has its own set of laws governing debt collections so it’s important to seek professional legal advice if you are being contacted by a debt collector, especially if you believe they are acting inappropriately. Get in touch with the team at Robert Wood and Associates today, we are here to help you during a time that may be stressful and overwhelming. Call (03) 9762 3877 or enquire online now.