If you owe a bank, firm, or another lending institution some amount of money and the debt is long-term and significant in amount, you may have to deal with a debt collector to resolve the situation.
Debt collectors use almost all legal measures available to them, as well as those that are against the law, in an attempt to get you to return your obligations.
Because they are under time constraints to produce results, they are all much too frequently too aggressive and high-pressure. Their practice may cross the line into harassment at times.
In recognition of the nature of the business, the Australian Competition and Consumer Commission (ACCC) has developed many regulations to protect you. If a Debt collector goes against these laws, you have the right to take legal action against them.
In order to help you in dealing with Debt Collectors in Australia, it is necessary to check out what Debt Collectors can and can’t do.
Here are the things Debt Collectors can do
Debt collectors are required to respect your right to confidentiality. They may reach out to you for the following reasons:
- Insist on receiving money.
- Make an offer to settle or a payment arrangement.
- Inquire why you haven’t adhered to a previously agreed-upon payment schedule.
- After an agreed-upon time, reevaluate the payment plan.
- Explain what would happen if you did not pay on time.
- You have the right to repossess assets you owe money on, provided they have gone through the proper procedure.
Here are the things Debt Collectors can’t do
- Invasion of your personal space.
- Employing oppressive techniques or harsh words is unacceptable.
- Harass you or contact you at unreasonably inconvenient hours or more often than is necessary.
- Mislead or fool you in some way.
- Take unfair advantage of you due to illiteracy, disease, disability, old age, or a lack of knowledge of the law.
- Allowing someone else to reveal your debt without your authorization is prohibited.
- Sell any of your property without first obtaining a court order to do this.
- Refuse to leave your property even after you have asked them to do so, notwithstanding your requests.
- Pretend to be someone other than a debt collector in order to avoid being identified.
- Giving incorrect details about the amount of money you owe them, as well as their rights and constraints.
- Bully or physically threaten you, or use profane or insulting language in your presence. This is unlawful in and of itself, and no individual or organization has the legal authority to do this to you.
Let’s check out how to simply deal with a Debt Collector
Be truthful and cooperative in your dealings.
If debt collectors contact you, it is your job to:
- Be completely honest regarding your financial condition, as well as any other debts.
- Cooperate with the debt collector.
- Respond to phone calls and emails as soon as possible.
- Determine whether or not you will be able to make a payment plan and agree on one.
- Notify the debt collector if any of your contact information changes.
Maintain good records.
Maintain a detailed and good record of all of your communication with the debt collector.
Some of the good records you need to maintain are:
- The date and time of interaction.
- The name of the debt collector as well as the name of the firm for which they operate.
- The manner in which they approached you (in person, by phone, letter, email, or text)
- Who said what and when.
If you are aware that you owe a particular amount but are having difficulty paying it:
1. Find out the available money that you can spend.
Make use of a budget planner to figure out how much money you can spare. Calculate your income and costs to see how much is left over after paying all of your bills.
2. Talk to the debt collector about setting up a payment plan.
Contact the debt collector and tell him/her that you are experiencing financial difficulties and would want to figure out a repayment schedule. They are expected to consider your request.
The debt collector may seek for financial information to prove your ability to pay the amount they want. Offer just an amount that you are certain you will be able to keep to.
The debt collector may consent to the following:
- Allows you to repay lesser sums over a longer period of time.
- If you pay a portion of the obligation in one large amount, the debt will be closed.
- If you have a poor income, no significant assets, and your financial condition is unlikely to improve, you might consider waiving your debt. Insist on getting the agreement in writing from the debt collector.
- If they reject your request, you should put it in writing to prove your point.
- If they still don’t budge, you may file a formal complaint with the appropriate authorities.
3. Make every effort to adhere to the payment schedule.
If you are having difficulty making your payments, call the debt collector as soon as possible. Give an explanation of why you’re having difficulties and negotiate a new payment plan.
Sometimes people are faced with harassment calls from debt collectors. In some cases, you have the right to stop such calls and even demand compensation for such behavior from debt collectors. For assistance you can call 1800 007 007 (National Debt Helpline), also you can read the US experience in stopping harrasment calling.
In Conclusion
Remember that there is a standard law that states that you can be left alone by a debt collector who is acting outside of the tight permissible boundaries set by the Australian Competition and Consumer Commission.
You need to note every time a debt collector calls you to ensure that you are not taken advantage of.
If they go beyond their authority, you should tell them in advance of your entire determination of charging them to court for their actions. It is recommended that you take them to court if they do not stop breaking the law.
Our main target is to ensure that all debtors would feel more powerful as a result of reading this article.
You should feel this way since the ACCC’s debtor protection provisions are designed to counterbalance the huge imbalance of power that occurs between major lending businesses and borrowers, as described above.