Debt Collection Defense FAQ

Frequently Asked Questions About Debt Collection

What happens if I ignore a collection lawsuit?

The court enters a default judgment against you. The collector wins without proving the debt was yours or that the amount was correct, and it can then pursue wage garnishment, bank levies and liens. In many states a judgment can be renewed for years.

This is the most consequential mistake available in a collection matter, and it is also the most common. Most collection suits end in default. Filing an answer by the deadline, even a simple one, forces the collector to prove its case.

How long do I have to respond after being served?

It depends on your state and the court, but it is commonly two to four weeks from the date of service. Check the summons itself, which states the deadline. Treat the earliest plausible reading of it as the real one.

Can a debt collector call my employer?

They may contact your workplace for the limited purpose of confirming your location, but once you tell them not to contact you at work, continuing to do so violates the FDCPA. They may not discuss your debt with your employer, your coworkers, your neighbors or your relatives.

Can they call at any hour?

No. Calls before 8 a.m. or after 9 p.m. in your local time are prohibited. Since Regulation F took effect in late 2021, more than seven calls in seven days about the same debt is also treated as presumptively harassing, and you can require that they stop contacting you by email or text.

Is there a time limit on collecting an old debt?

Yes, set by state law, commonly three to six years though it varies by state and by the type of agreement. After it expires the debt is time-barred and suing on it can itself violate the FDCPA.

Be careful here: in a number of states, making a payment or acknowledging the debt in writing can restart the clock on a debt that had already expired. Establish when your last payment was before making another one.

A collector is offering a big discount if I pay something today. Should I?

Find out how old the debt is first. Unusual eagerness to accept a small payment on a very old account is sometimes an attempt to revive a time-barred debt.

If the debt is legitimate and in-period, settlement discounts are real, especially with debt buyers. Get the agreement in writing before you pay, stating that the payment resolves the account in full and how it will be reported to the credit bureaus.

I do not recognize this debt at all. What now?

Dispute it in writing within 30 days of the validation notice and demand verification. Collection must stop until the collector provides it. Accounts are frequently misattributed after being sold several times, and accounts opened through identity theft enter collections the same way any other does.

Can they garnish my wages without suing me first?

Not for ordinary consumer debt. Garnishment requires a judgment, which requires a lawsuit. Some obligations such as federal student loans, child support and certain taxes follow different rules and can reach wages through administrative process.

How much of my pay can be taken?

Federal law caps it for most consumer debts at the lesser of 25 percent of disposable earnings or the amount by which weekly earnings exceed thirty times the federal minimum wage. Several states protect more than that, and a few bar wage garnishment for consumer debt almost entirely.

Is my Social Security protected?

Social Security, SSI, VA benefits and certain other federal payments are generally protected from private creditors. The practical complication is that protection does not apply itself once the money is deposited and mixed with other funds in an account. Accounts do get frozen even when the funds inside were exempt, and claiming the exemption is a filing with a deadline.

Can I be arrested over a debt?

No. There is no debtors' prison in the United States for ordinary consumer debt, and a collector threatening arrest is violating the FDCPA. The narrow exception people confuse this with is being held in contempt for ignoring a court order, such as a properly served order to appear, which is a separate matter from the debt itself.

What can I actually recover if a collector broke the rules?

The FDCPA allows statutory damages up to $1,000 per lawsuit, plus any actual damages you can show, plus attorney fees and costs. The fee-shifting provision is why many attorneys in this area will review a case without charging upfront, and why a documented violation improves your position in the underlying collection dispute as well.

Does the FDCPA cover the original company I borrowed from?

Generally no. The statute is aimed at third-party collectors and debt buyers. An original creditor collecting its own account is usually outside it, though some states have their own statutes that reach further. This is worth confirming for your state before deciding which rules apply.

Should I record the calls?

State recording laws differ. Some require the consent of only one party, others require all parties to consent, and recording without the required consent can create a problem for you. A detailed written log with dates, times and what was said is lawful everywhere and is what most of these cases are actually built on.

General information about federal law and common state patterns, not advice about your own situation. Deadlines, caps and exemptions vary by state and court.