Debt Collector Called Me: What Should I Do?

1 year ago
admin
3 minutes

Why is My Debt with a Debt Collection Company?

So, you’ve got a call from a debt collector. Here’s why this might be happening:

  • Debt Sold to Collectors: Your original creditor, like a bank or credit card company, might have sold your debt to a collection agency. This happens when they think it’s easier to sell the debt for a fraction of the amount owed than to keep chasing you.
  • Third-Party Collectors: Sometimes, the original creditor hires a collection agency to recover the debt on their behalf. This means the debt is still with the original creditor, but the collectors are doing the legwork.

Can They Take My Assets?

The thought of losing your stuff is scary, but it’s not that simple under Australian law:

  • Legal Process Required: A debt collector can’t just show up and take your assets. They must first sue you and get a court judgement against you.
  • Exempt Assets: Even if they win in court, certain assets are protected by law. In Australia, these typically include basic household items, tools of trade up to a certain value, and sometimes a modest car.

How Many Times Can They Call?

Let’s talk about those persistent calls. In Australia, debt collectors must adhere to the Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) guidelines:

  • Reasonable Contact: Debt collectors are generally allowed to contact you within reasonable limits. They must not harass you with constant calls.
  • Time and Frequency: Collectors can only call during reasonable hours, typically between 7:30 am and 9 pm on weekdays and between 9 am and 9 pm on weekends. They should not call more than three times per week or ten times per month.

I Don’t Want to Talk to Debt Collectors. What Else Can I Do?

Talking to debt collectors can be stressful, but you have options under Australian law:

  1. Request Communication in Writing: You can ask the debt collector to contact you only in writing. This way, you have a record of all communications, and it’s less stressful. Make this request in writing and keep a copy for your records.
  2. Dispute the Debt: If you believe the debt isn’t yours or there’s an error, you can dispute it. Send a letter to the collection agency explaining why you dispute the debt. They must then verify the debt and provide proof. Under the ACCC and ASIC guidelines, collection activity must stop until the debt is verified.
  3. Set Up a Payment Plan: If you owe the debt and want to pay it off, negotiate a payment plan that works for you. Collectors are often willing to accept smaller, regular payments. Make sure any agreement is in writing.
  4. Seek Professional Help: Consider talking to a financial counsellor. They can help you manage your debts and deal with collectors. Services like the National Debt Helpline offer free financial counselling.
  5. Legal Protection: If a debt collector is harassing you or violating your rights, you can report them to the ACCC or ASIC. You can also seek advice from a legal aid service or a private solicitor.

Conclusion

Dealing with debt collectors doesn’t have to be a nightmare. Understand why they’re calling, know your rights under Australian law, and explore your options. Whether you choose to negotiate, seek professional help, or switch to written communication, you can manage this situation without losing your sanity. Remember, you’re not alone, and there are resources available to help you navigate through this. Stay calm and take control!