How Do Collection Accounts Affect You and Your Credit?
Debt is a common occurrence in today’s society and causes stress to millions of Americans each year. Dealing with debt collectors is often overwhelming and seems to make everything a bit worse. If you do find yourself in debt, it’s important to arm yourself with information about debt collection so that you can prepare yourself for what’s coming next.
Learn about debt collection accounts and what that means for you and your credit.
What is a Debt Collection Account?
When you have an account that becomes seriously overdue, a creditor may send your account to a third-party debt collector. Debt collectors work to recover payments for others on their behalf.
Once your account is in collections, debt collectors work tirelessly to get you to repay what you allegedly owe them. Debt collectors will call you, send you letters, contact you at work, and send updates about the status of your payments to your credit report.
The Fair Debt Collection Practices Act (FDCPA) outlines specific rules for debt collectors to follow during their pursuit of repayment. Unfortunately, not all debt collectors follow these rules and take advantage of those who are unaware of them.
Some of the illegal things debt collectors do include:
- Sending illegal debt collection letters
- Calling too early in the morning or too late at night
- Calling more than once a day
- Calling more than five times per week
- Calling at work when they were asked not to
- Exaggerating the amount owed
- Threatening arrest or violence
This list is not exhaustive. There are hundreds of other illegal things debt collectors do to try to get you to pay. If you believe you are a victim of such practices, contact a consumer rights attorney immediately.
How Does Debt Collection Affect My Credit?
When your account is sent to a collection agency, it is updated to the “collection” status. A collection account on your credit report is a serious problem because it shows that you were consistently negligent on the account.
When a collection appears on your credit report, your credit score drops to reflect that. Ridding yourself of debt collection on your account is not simple. It can stay on your credit report for up to seven years. This can affect future loans and credit card applications, as well as cause a significant amount of stress.
Collection accounts should be taken seriously and handled with care. You should especially take notice if you feel your debt collector has violated the FDCPA. If you have, it’s likely you can receive compensation for the harassment. You can earn up to $1,000 for your case.
The Law Offices of Jibrael S. Hindi fight against FDCPA violations and work to protect your rights against debt collectors. Give us a call and we can immediately determine if you have a case, and we will represent you free of cost! Contact us at 1-844-JIBRAEL to learn how our Miami consumer rights attorneys can help you today.