Debt Collection in CA: There are federal and state laws that debt collectors must follow. The following information is a summary of the rules for debt collection in California.
Scenario: Jennifer Anniston as a letterthat reads, "you owe $3,025.24 to Springulint on a delinquent bill. If you have any questions, please call us." The letter is from a collection agency called Debt Collector, Inc. Before Jennifer or her agent pays the alleged debt, they must understand how Jennifer received the letter and what is needed to make sure the debt really is hers.
History of the Debt: A debt collection agency works to collect debts. Often, the consumer will not recognize the name of the company that sent the collection notice. Some debt collectors are in-house with the company, some are outside agencies and some are agencies that purchased the original debt. Scenarios: 1) Jennifer signed up for wireless phone service with the company over a year ago. In July, she received a bill with very high international charges and emphatically stated she did not make the calls. Instead of disputing the bill in writing, she decided to pay her normal monthly charges without paying what she didn't owe. Springulint sent several more bills to Jennifer that she ignored.
2) Last year, someone used Jennifer's name and social security number to sign up for wireless service. The person ran up a very large bill and never paid for the service. Jennifer is now receiving a debt collection notice for a debt she did not personally incur. (1) Paying the Debt: a) If consumers want to pay the full debt, read the instructions on the letter carefully; b) If consumers want to set up a payment plan over a period of time, call the collection agency to to discuss this option and be sure that any agreements are in writing. If the collection agency will not send written confirmation of the payment plan, do not send any money; and c) Keep records and copies of all contact (phone calls, voice mails, written correspondence, documents) with the agency, including all written material you send or receive. Be sure you document any check or money order that has been cashed. (3) Disputing the Debt: Disputing the Debt: If you believe the bill has already been paid or that you do not owe the debt, contact the collection agency to dispute the debt. The first collection letter must include instructions on how to dispute debts. If (and only if) you do not believe you owe the debt, follow the instructions on the letter and call the collection agency. Always follow the call with a certified return receipt requested letter to the collector and a copy to the original creditor. Once the collection agency has information that you are disputing the charges, it must conduct an investigation and may not attempt to collect the debt until it has completed the investigation and proved to you in writing that you owe the debt. (Note: A debt collection agency may sell your debt to a second collection agency. Your only recourse is to send a dispute letter tot he new collection agency and start the process again. Even though collection agencies are required to conduct investigations, many only check their computer systems or files to verify the name on the debt, the amount on the statement and the name of the company for which they are collecting. They may call and/or send letters to every Jennifer Annistan in the United States until they find the alleged responsible party.
Information Debt Collectors must Provide: Within 5 days of contacting you about an unpaid debt, the collector must tell you (1) the amount you owe, (2) the name of the original creditor (company you owed) and (3) the process to follow if you dispute the bill. In every notice asking for payment, the debt collector must also provide (a) the creditor's name, (b) contact information (including name, address & phone #) of the collection agency, (c) date the notice was mailed and (d) amount due. If the collector contacts you about the debt, you must be given his/her name or the name of the collection agency and an explanation that he/she is trying to collect a debt.
A Collection Agency May
A Collection Agency May NOT
Contact you to collect the debt.
Call you after you ask them to stop contacting you. However, the agency may contact you one more time to tell you what action it plans to take. Requesting that the agency no longer contact you, may mean the agency will sue you to get the debt paid.
Threaten you, put you in jail, or use obscene or profane language; including racial slurs.
Claim to be someone else - like an attorney or government employee.
Call you to discuss the debt.
Call you before 8 a.m. or after 9 p.m. without your permission.
Send written information to you.
Send post cards about the debt or letters on heading that looks like correspondence from a law firm. Send documents that look like court papers when they are not.
Contact you at work.
Contact you at work if the debt collector knows or should know that your employer does not allow you to receive personal calls at work.
Add interest to your bill.
Collect for fees and interest or other costs of collection unless the original agreement allows the charges, or as permitted by law.
Supply information to credit reporting agencies (Experian, Equifax, Trans Union) about the debt.
Continue to report the debt to credit bureaus while it is being investigated. The debt must be reported as “disputed.”
Sue you in Superior Court
Sue in Small Claims Court. However, the phone company may sue you in Small Claims Court.
Unauthorized Debit
Collectcorp sent a notice to my adult son on 11/17/07 with amount due $3499.78. I mailed a check to Collectcorp on his behalf. The representative advised me that $288.98 was still due to pay the account in full. I provided my account number and authorized a debit on 1/15/08 of $288.98.
On 2/20/08, Collectcorp made two debits to my account in the amounts of $81.86 and $2.99 without authorization. They haven't returned my phone calls.
How should I proceed?
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