It is said that a debt collector’s biggest problem is an educated consumer. I constantly preach that at all my seminars. It’s the classic phrase “Knowledge is Power”.

One of the biggest things to know is Can you actually be sued? You can find this out by going to Google and type in “State Statute of Limitations for debt collectors in (insert your state). Then for most accurate information click on the link from your states site. As an example in Texas and California it is 4 years. Some states are less, some are longer.

In the 11th Circuit case, Osorio v State Farm Bank the court reinforced restrictions under the Telephone Consumer Protection Act .

The main thing it accomplished was prohibiting debt collectors from using automated dialing systems (nicknamed Robocalls) on a consumer’s cell phone without their express permission.

Many lenders now if you pay attention on a collection call to your current lender asks if it is ok to keep in touch with you via cellphone or by text message and has a code to type in to stop it.

Many people have been using this law to sue debt collectors over harassment rather than the Fair Debt Collection Practice Act as studies have recently shown.

No one ever gets a product, service or line of credit with the intention of defaulting on that obligation, but life does happen. And thanks to the government and a special provision that lender can take a tax break (exact amount unknown) and then still sell the debt for collection efforts and then try to sue you for the full amount. The example I give is from Seinfeld in the scene where George “double dips” the chip.

Like everything in life it’s not what you said or did but what you can prove so keeping a notebook for accurate records is a MUST. Claiming you told them to stop calling you is stopped by the other party saying “no you didn’t”

While technically a debt can be owed forever once it passes your states statute of limitation and becomes over 7 years old if you still get harassed by a debt collector the nickname we have for them is “Zombie” debt collector. Someone who most likely got the debt for free and tries to get any money they can from you.

While I always tell my clients while I never advise them to not to pay their debt as a credit expert and consumer advocate I also need to inform them of the consequence good or bad of doing what they perceive is the right thing.

So beware of anything you sign where you are giving permission to them to utilize you r cell phone for debt collection as its your right to have them contact you via mail to your home thus lowering the stress of cell phone harassment. While this issue is far from over it’s a great positive step toward preventing harassment by debt collectors.

Most people do not realize the debt collector does not have to just curse and threaten you to break these laws. Implying they can sue you when they can’t or stating they are calling the constable on you for breaking a car lease is a civil matter.

Hope this helps everyone and go to my website for more and feel free to call me if you need help with your credit or just to get to that next credit level in life!