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Debt collectors.

Their job is to make you so miserable that you will pay off the amount they are attempting to collect. Last week we discussed debt issues that become so serious they’re referred to collection agencies. For many Canadians living paycheque to paycheque, any unexpected expense that comes up can disturb a very delicate balance and before you know it, you’ve missed a payment or defaulted on a loan. This triggers an unfortunate series of events and now in addition to the serious debt, you are being pursued by debt collectors from the collection agency. Some of them can make your life very unpleasant but you do have rights.

What are your rights? Collection agencies are regulated and each province has its own rules and regulations. In Ontario, the Ministry of Consumer Services regulates collection agencies through the administration of the “Collection Agencies Act”. If a collection agency behaves inappropriately, file a complaint with the Ministry. You have rights:

You must be notified in writing through the mail (not email) that your file has been given to a collection agency before they can start calling
The notice must include the name of the creditor (the person or business that says you owe them money), the amount the creditor says you owe, and the name of the collection agency and its authority to demand payment on behalf of the creditor
After sending the notice, the agency must wait 6 days before they can contact you in person or by phone.

The collection agency cannot:

Contact you on Sunday, except between the hours of 1 PM and 5 PM
Contact you on any other day of the week between the hours of 9 PM and 7 AM
Contact you on a statutory holiday
Use threatening, profane, intimidating or coercive language
Use undue, excessive or unreasonable pressure

The collection agency cannot continue to contact you if:

You send a registered letter to the agency saying that you dispute the debt and suggest the matter be taken to court.
You (or your lawyer) send a registered letter to the agency providing your lawyer’s contact information and notifying the collection agency to communicate only with your lawyer.
You have told them that you are not the person they are looking for unless they take reasonable precautions to ensure you are that person.

What should you do? The best thing to do about a collection agency and its debt collectors calling you is to deal with not only the people from the collection agency are trying to collect, but all of your debts. The best time to deal with them ideally is once you sense there is a problem and before they are referred to a collection agency.

If the debt collectors are calling you, it’s not too late to call a trustee. Ira Smith Trustee & Receiver Inc. is full-service insolvency and financial restructuring practice serving companies and individuals throughout the Greater Toronto Area (GTA) facing financial crisis or bankruptcy that need a plan for Starting Over, Starting Now. Contact us today for a solid plan for dealing with your debts so that you can get back on track to living a debt free life.

Are debt collectors calling? I recently read an article where the headline was 35% In US Facing Debt Collectors and it’s based on a study by the Urban Institute. This astonished me. How is it possible that 35% of Americans have debts and unpaid bills that have been reported to collection agencies? This means that one in three people in America is being hounded by a collection agency having their debt collectors calling for unpaid bills.

Imagine that one in three of your friends and coworkers are facing serious financial challenges and you probably don’t even know it. According to the study 35.1% of people with credit records had been reported to collections for debt that averaged $5,178, based on September 2013 records. The Association of Credit and Collection Professionals reports that healthcare related bills account for 37.9% of the debts collected. Student loan debt represents another 25.2% and credit card debt make up 10.1%. Other collections are monies owed to the government, retailers, telecoms and utilities. That is giving this industry a lot of work for their debt collectors calling one third of the American population!

This is not just an American problem although in Canada we are extremely fortunate that we don’t incur the amount of healthcare related debt that plagues the U.S. But that doesn’t make us immune from serious debt and debt collectors calling. According to an RBC poll which only measures non-mortgage debt such as credit cards, lines of credit and loans:

The average level of personal debt in Canada rose 21% per cent this year to $15,910
Albertans were the hardest hit with a 63% jump to $24,271 in debt
British Columbian personal debt loads went up by 38% to $15,549
Manitoba and Saskatchewan went up 32% to $16,145
Average debt in Ontario was up 13% to $17,416
Average debt in Quebec was up 3% to $10,458
Average debt was up in Atlantic Canada by 12% to $15,243

Before you get to the stage that the collection agencies are after you with their debt collectors calling, make an appointment with a professional trustee and deal with your debt; don’t hide from it. Contact Ira Smith Trustee & Receiver Inc. We help people everyday who are facing a financial crisis or bankruptcy that need a plan for Starting Over, Starting Now. Don’t wait, especially if the collection agencies are hounding you with their debt collectors calling, call us today.

Watch for our next blog when we’ll be discussing what to do if the collection agencies are after you with their debt collectors calling.