Credit can be a good and often times necessary thing, but when debt goes bad--watch out. With the current state of the economy, the issue of mounting debt (and folks falling behind on payments) has grown. From this, third-party collection agencies are increasingly on the move, buying up debt and looking to collect. True, no one wants to ever be in the delinquent position of having a debt collection agency coming after them. Still, third-party debt collection plays an important role.

According to the Association of Credit and Collection Professionals, there are 6,500 collection agencies in the United States; and in 2005, they returned $39.3 billion back into the economy. That being said, not all collectors follow the rules in getting people to pay up. According to a CNN Money report out this week, complaints against debt collectors are on the rise. Sometimes, aggressive collectors cross the line into harassment--doing things like calling at odd hours (up to six times a day) and threatening debtors with jail time. According to the Federal Trade Commission, here are some basic rights everyone has to protect against overly aggressive third-party debt collectors:

• They cannot contact you at odd hours (like before 8am or after 9pm) unless you agree. They also can't repeatedly call just to annoy you.
• You cannot be threatened with arrest, jail time or personal harm.
• They can't intimidate you with false statements like exaggerating how much you owe, list crimes you haven't been charged with or claim they work for a credit bureau.
• According to the CNN report, you can stop a debt collector from calling by writing a letter to the agency telling them to stop.
• Also, if you have an attorney, debt collectors must contact them and not you.

If you think a debt collector has crossed the line with you, contact your state attorney general's office and file a complaint with the FTC. Debt collection isn't very pretty, and undoubtedly there are delinquents out there who need to be chased aggressively, but everyone has rights--that's the law. For more information on debt collection, check out this brass article.

--Peter

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