Have you heard from a debt collector? Here are some facts you should know

If you owe money, you are legally obligated to pay. Failure to pay off debts can lead to a poor credit history. Your access to further credit will be cut off. More debt makes it harder to pay off past and current bills at the same time. A creditor has the right to contact you to collect outstanding debts. Some employ the services of a debt collection agency to press for the money owed. Sometimes these agencies violate the law. New York City law prohibits harassment or abuse by collectors. All debt collection agencies that seek to collect debts from New York City residents must be licensed by the Department of Consumer Affairs (DCA). All debt collection agencies must comply with the City's Consumer Protection Law and rules enacted by DCA, or risk suspension or revocation of their licenses by DCA.

Say you owe money. Sometimes a debt collector may pull dirty tricks to intimidate you into paying off. Collectors are not entitled to cross the line between lawful collection practices and menacing intimidation. The City's debt collection law provides the strongest anti-harassment protection in the country. It covers debt collection agencies and companies' in-house collection departments in their efforts to collect outstanding debts for clients.

Not allowed By the book

Child support payments

• Engaging in acts of violence, threats of violence or obscene language.
• Making false statements, including misrepresentingthe character or status of the debt, and stating that nonpayment will lead to the collector seizing your wages, unless the seizure is lawful and the creditors intend to pursue such action.
• Calling a debtor at an inconvenient or unusual time, particularly before 8 AM or after 9 PM, or more than twice a week.
• Advertising a debt or revealing it to another person.
• Contacting your employer for any reason other than to locate you. This also applies to contacts with neighbors, family, and friends. Creditors and debt collectors cannot discuss the alleged debt with anyone other than you. Under the law, debt collectors must:
• Notify you of the right to dispute a debt, and stop trying to collect on disputed debts, until a correction has been made or an explanation has been sent. 
• Stop bothering you if you request it in writing. They may send one final notice telling you if they plan to sue.
• Deal only with your attorney, after you have hired one and informed the collectors of this.

NOTE! Licensed debt collectors that collect

CHILD SUPPORT PAYMENTS must:

• SUBMIT TO DCA a copy of the standard contract with clients for the collection of child support payment to ensure compliance with the requirements governing the content of such contracts.
• FURNISH a surety bond for $5,000 payable to the City of New York as a condition for obtaining a collection agency license, or renewing such license, on or before its next expiration date.

Who's exempt?

The law does not apply to debt collection activities

performed by:

• state and federal employees
• nonprofit credit counseling organizations
• public utilities regulated by the Public ServiceCommission
• individuals performing an action required by law

If the debt is valid

? Do not suggest to the creditor that you can pay off the debt when you cannot, or that you can't pay the debt when you actually can.

Pay your SECURED DEBTS first ? when property has been put up as collateral. However, don't ignore your other unsecured debts. Make every effort to pay them off as soon as possible.

If you are not sure if the debt is valid

• Let us know. We will find out.

We will tell the collector, in writing (verbal requests have no legal weight), to immediately cease contact about the alleged debt.

Our letter will act as a CEASE AND DESIST ORDER. This is a request to cease all further communication in regard to this matter. Your account of the alleged debt is inaccurate. Any further communication beyond what is legally allowed will be a violation of the law.

Our letter will mention any abusive tactics used on you by the collector's employees.

After receiving our cease collection letter, a collection agency is only authorized to contact you once more, in writing, to inform you of any further legal action they intend to pursue.

If collection agencies continue to communicate with you or harass you after we send a cease collection letter, notify us immediately. They are violating the law, and we will file a complaint with the Department of Consumer Affairs. You also can take legal action against a collector who persists in trying to collect on the debt claim. For any legal case, be sure to document all calls and contact with the collector.

Know your rights

•  If you make a deal over the telephone with a debt collector, insist that the collector confirm it in writing. No deal is binding without written confirmation.

• Never ignore debt collectors. Even small debts can hurt your credit record.

•  If you are sued, do not ignore a court summons. Consult with us. If you ignore the summons, the creditor can obtain a default judgment, which may include fees and interest charges in addition to the debt itself. A judgment may also lead to seizing your wages.

• Do not let a debt collector persuade you to borrow money from a friend or family member to pay off a debt. Never let a debt collector talk you into getting further into debt.

• You have a legal right to declare bankruptcy, but should seriously think about it and explore other options first. If you are considering declaring bankruptcy, consult with a credit counselor or an attorney first.

Or for best results you can hire us.

How to resolve complaints

You can file complaints about the actions of debt collectors or debt collection agencies with the NYC Department of Consumer Affairs or the Federal Trade Commission (FTC). For more information or to file a federal complaint, call the FTC toll-free at (877) FTC-HELP or go to www.ftc.gov.

Michael R. Bloomberg, Mayor

Jonathan Mintz, Commissioner

The New York City Department of Consumer Affairs works to ensure that consumers and businesses benefit from a fair and vibrant marketplace. If you would like more information about the work of the agency or our new strategic initiatives, please call 3-1-1 or contact: New York City Department of Consumer Affairs 42 Broadway, New York, NY 10004-1617