Editorial Policy

Should I tell debt collectors to go away?

Erica Sandberg

May 30, 2014

QHi Erica,

Will telling collectors to go away and stop calling me because I have no money to give them make my credit problems worse? I honestly can't handle them anymore. They are calling me on my cellphone night and day. — Gilbert

ADear Gilbert,

To turn a phrase, “with responsibilities come rights” — and for you, this means protection against illegal collection efforts. According to the Fair Debt Collection Practices Act, third-party collectors are not permitted to harass you, which is generally determined to be calling more than once per day. They may call your mobile phone or landline number. While they can reach out any day of the week, including major holidays, they can't call before nine in the morning and after nine at night.Ask Erica

That said, telling a collector to stop calling once and for all can either be to your benefit or your detriment — depending on your financial situation.

A formal “stop all future communications” is essentially a cease and desist order. you have the right to send it as per the fair debt collection act. Upon receipt, third-party collectors have two options: honor your request or sue you for the outstanding debt.

And therein lies the problem. Your notice could prompt a lawsuit. If the debt is valid and they sue you, there is a good chance you'll lose the case. After that, you'll be slapped with a judgment, and will owe far more than what you owe now because of court costs. Your credit report, too, will suffer more damage.

For these reasons, you should never tell a collection agency to buzz off when:

1. You legally owe the debt.

2. The amount is large. (There are no firm rules, but over a few hundred dollars is a decent guideline.)

3. The statute of limitations for lawsuits is in effect. (Each state is different.)

4. You have the means to pay.

Conversely, you may be safe from a lawsuit if the debt is yours but tiny, the statute of limitations has run out or you have no assets to satisfy it. With no wages to garnish or assets to claim, the worst that could happen even if you were sued would be a credit report that shows the monitory judgment. And since your reports are damaged from the collection process anyway, the effect might be negligible.

Tell the collector to stop ringing you if they are calling more often than is legally allowed. Also, if they are threatening lawsuits but not taking action, explain that you know they are performing an illegal collection act. Calmly tell the collector that you understand your rights and responsibilities under the fair debt collection act, and that they need to stick to those restrictions or you'll file a complaint with the Federal Trade Commission.

If you do owe the money and are just stalling because you don't want to pay, reconsider your actions. They are calling because you ran up a bill. They bought it from a different creditor, sure, but they spent the cash and want to recoup their investment. You can either send all that you owe or attempt to negotiate a settlement. Do either and the calls will end. Your credit report will reflect your payment and you can begin down the road to recovery.

Got a question for Erica? Send her an email.