Debt Collectors: How to Spot the Fakes

by Guest

Debt Consolidation, Circa 1948

If you are facing financial difficulty and are months behind on making payments, don’t fall for fake debt collectors calling your home demanding money.

Scams involving fake debt collectors are nothing new, but their numbers have risen since the economic recession began. Despite warnings from the Better Business Bureau, many of these scammers continue to threaten consumers.

Fraudulent collectors may claim to be attorneys. They often use this tactic to make the debtor believe he or she will be sued or taken to court over debts.

These types of scams usually make it easy to wire the money or make an automatic payment to avoid going to court. These debt collectors are always persistent.

They will have your account numbers, social security numbers, employment history and home address all in the effort of appearing legitimate. The phone calls are usually abusive and threatening in nature and the calls come at frequent intervals.

For anyone behind on payments, the feeling of guilt is already present. Fake debt collectors draw on this emotion of guilt and fear to get paid.

Anyone receiving these types of calls should not give out personal information. You should request proof of the debt in writing.

Another step you can take is issuing a fraud alert. Contact each major credit bureau, Equifax, Experian and Transunion, to get a copy of your current credit report. Use it to check for fraudulent activity.

You should also report any threats to the Attorney General’s office. Do the same for any company that refuses to issue you a written proof of the debt.

Know your rights and use them, even with real debt collectors. If you tell the debt collector that you are not the person they are trying to contact, they have to stop calling you, by law.

To keep collectors from constantly calling you at home or work, send a letter to the agency. Stating over the phone that you wish to cease communications is not sufficient. Once they receive a cease communications letter, they cannot legally contact you unless a lawsuit is in the works.

Try not to worry over empty threats or lawsuits and jail time. Most debts are never brought to court unless the amounts are excessive. Even then, the majority of judgments go uncollected.

One good way to get back on track is by taking out debt consolidation loans. These loans can give you piece of mind by consolidating all of your debt into one, reducing stress and getting rid of those nasty collection calls.

A great benefit of debt consolidation loans is that you can manage your budget much more easily since there is only one payment to make. Your credit score will also improve as you begin to pay down the loan.

For those who are beyond consolidation, bankruptcy should be considered as the last option. Bankruptcy allows you to have a fresh start and may even protect your business or home.

There are different types of bankruptcies and other debt consolidation options available to anyone in financial trouble. Seek out legal advice or contact a local non-profit financial counselor to help you get back on track.

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Photo: Some rights reserved by Orin Zebest

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