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What You Need to Know About Debt Collectors

Between our mortgage, utility bills, paying our student loans, putting a down payment on a car, and whatever other bills we have, life can get expensive.  Whether we recently got laid off or just can’t keep up with our never ending bills, it may have pushed us to borrow some money.  Borrowing is a great resource – as long as you make your payments.  If you don’t, debt collectors may come looking for you.  If they do, here’s what you should know.

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Debt Collection Process

  1. In the first 6 months, you will likely deal with the creditor’s internal collector, which is usually a first-party agency.  Since no middleman is involved, this is the best time to try to settle your debt.
  2. If you don’t pay your debt, however, a third-party organization will become involved.  The third-party will try to receive the debt from you in order to receive a commission from the creditor.
  3. If this isn’t successful, the last phase will take place.  In this phase, your original creditor will write off your debt and sell it to an outside agency.  The collection agency will then try to get the money from you in order to make a profit.


How to Know When Debt Collectors Are Violating Rules

Debt collectors are known for being aggressive in trying to get the money back.  Legally, they’re able to contact you through every communication system available, including calls, text messaging, emails, or letters.  That being said, they must follow the Fair Debt Collection Practices Act (FDCPA), which includes:

  • Identifying themselves as a debt collection agency and giving the name and address of the collection agency.
  • Telling you the name of the creditor that you owe, the amount you owe, and how you can dispute the debt.
  • Sending a written notice with the correct information within 5 days of initial contact if they didn’t provide verification information during the first communication.


Being in debt can be scary, but it’s important that you know the right processes behind debt collectors.  When you hire a real estate lawyer in NYC, they’ll provide you with the necessary information and help you settle your debt in the best way possible.

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