Debtors’ Rights: Dealing with Collection Agencies
Are you being contacted by debt Following are some of your rights under
collection agencies? debt collection acts and garnishment laws.
This publication should help you What if you do not think you owe
understand debt collection practices and
the debt?
your rights when dealing with debt
collectors. If you are being sued, or if there When a collection agency first contacts you
is already a judgment against you, see our in writing regarding a debt, it must provide
publications Debtors' Rights in a Lawsuit or you with a written notice that has certain
information packets on How to Answer a information. (If the collection agency first
Lawsuit for Debt Collection or How to Claim contacts you by phone, insist that they also
Personal Property Exemptions. Get these at contact you in writing.) The first written
our website: [Link]. notice from a collection agency must have:
Or call the CLEAR intake line. (Contact info • The name and address of the
at the end of this publication.) collection agency;
What is a collection agency? • The amount of the debt, stating the
Collection agencies are regulated by both original debt and a breakdown of
the state and federal government. Both the other costs or interest;
State of Washington and the federal • The name of the creditor you owe
government have laws protecting debtors the debt to;
who are contacted by collection agencies. In
Washington, these laws are called the • A statement that unless you dispute
"Collection Agency Act" (in RCW 19.16.100) the debt within 30 days after you
and the "Consumer Protection Act" (in RCW get the notice, the agency will
19.86.010). The federal act is called the assume the debt is valid;
"Fair Debt Collection Practices Act" (in 15 • A statement that, if requested
U.S.C. 1692). You can find these laws at within 30 days, the collector will
your local library or online. provide the name of the original
Federal and state law defines a collection creditor, if different from the
agency as a business or organization whose collector; and
principal purpose is the collection of debts. • A statement that if you notify the
It does not include the credit or collection debt collector in writing (within 30
office of a business whose primary purpose days of receiving the notice) that
is not debt collection. Example: The credit you dispute the debt, the collection
office of a large department store or car agency will get verification of the
dealership, or a bank that issues credit debt and mail it to you.
cards and attempts to collect a debt, is not
a "collection agency" within the meaning of Every communication from a collector must
state and federal law. Collection of debts is clearly disclose that the purpose of the
not their main business. Attorneys who communication is to collect a debt, and that
regularly collect consumer debt are also any information obtained will be used for
considered “debt collectors” who must that purpose.
comply with the federal law.
1
You must notify the collection agency in How do I stop the collection agency
writing within the 30-day period described from contacting me?
above if you disagree that you owe the debt
Under the Fair Debt Collection Practices
or any portion of the debt. Once the
Act, if you notify the collection agency IN
collection agency gets your written notice
WRITING that you want it to stop further
that you dispute the debt, it must stop
communication with you, the collection
collection of the debt until it has proof that
agency cannot communicate with you
you do owe the debt and sends that proof
further, except:
to you.
• To advise you that it is stopping
Keep copies of the letter you send to the
its effort to collect; or
collection agency. Whenever possible, send
letters to collection agencies by certified • To advise you that the collection
mail, return receipt requested. See Form agency intends to take action,
Letter #1 at the end of this publication. such as bringing a lawsuit against
you.
Some examples of disputes of debts:
This law applies whether you owe the debt
• You do not believe you owe the debt
or not. If you write such a letter to a
or the amount as stated;
collection agency, include the following:
• You already paid the debt;
• Your name and address and, if
• You had medical coupons to pay for available, the account number on
a debt, and the creditor should have the statement received from the
billed the state; collection agency;
• you were hospitalized, told the • The date;
hospital you could not pay for care,
• A statement that you are exercising
and the hospital should have
your rights under the Fair Debt
considered payment under a
Collection Practices Act; and
charitable care policy; or
• A statement that you want the
• You believe collection of the debt is
collection agency to stop calling or
time-barred. (See below).
writing you, or both.
There are legal time limitations within
See Form Letter #2, at the end of this
which a legal claim must be begun.
publication. KEEP A COPY OF THIS LETTER.
Otherwise it is “barred.” This means that
Mail the original to the collection agency.
the collection agency waited too long and
Mail a copy to the original creditor.
cannot bring the claim now. The claim has
expired. YOU MUST SEND THE LETTER TO THE
COLLECTION AGENCY. If, after you send the
The exact time limitation will depend on the
letter, the collection agency contacts you
basis for the debt or the type of claim being
again for some reason other than the two
made. Most claims based on written
reasons stated above, the collection agency
contracts or accounts receivable governed
has violated the Fair Debt Collection
by WA law must be begun within six years.
Practices Act. Under this law, you have the
Most claims based on oral contracts or
right to sue the collection agency for money
accounts receivable must be begun within
damages and lawyer fees.
three years.
2
This will not stop the
collection agency from suing Example: As of 2012, the
you. It only stops calls and federal minimum wage is
letters from the collection $7.25 an hour. If you make
agency. less than $253.75 a week
net, all of your wages are
Which property and income is exempt. If you make $400 a
protected from debt collection? week, $300 is exempt (since
Certain kinds of income and property $300 is 75% of your wages,
cannot be taken to collect a consumer debt. and that amount is more
They are: than $253.75).
This income is usually not
• Social Security exempt from garnishment
• Supplemental Security Income for child support payments
or taxes.
• Temporary Assistance for Needy
Families (TANF) If your income is exempt from garnishment,
let the collection agency know. Put it in
• All pensions: private, federal and
writing to the collection agency. Keep a
civil service, once deposited into
copy of the letter.
your bank account or cashed
Example: If your only income is Social
• Labor & Industries disability
Security, which is exempt from garnishment
payments, and
by federal law, then write just that in your
• Unemployment Compensation. letter. You should also put this information
in any of your other written
Some of your wages are also exempt: The
correspondence to the agency. (Example: a
greater of 35 times the current federal
“cease communication” letter.)
minimum wage or 75% of your net wages.
("Net wages" means gross pay minus taxes, While this is not a defense to the underlying
Social Security, and other mandatory claim, it does let the collection agency know
deductions.) Call the Department of Labor that your only income is exempt from
to find out the current federal minimum garnishment. If the collection agency
wage, or check here: successfully sues you and then garnishes
[Link] your bank account containing exempt
Then multiply that amount by 35. funds, then you may be able to sue the
collection agency.
Certain property cannot be taken to collect
a debt:
• $125,000 equity in your home
• Your car, if it is of limited value and
• Your personal belongings, up to a
certain monetary limit.
3
For more information, or if a creditor or government documents or a
collector is trying to garnish your income or telegraphic or emergency message.
property, see our publications How to Claim 7. the debt collector cannot ask for a
Personal Property Exemptions and Debtors' postdated check in order to
Rights in a Lawsuit. threaten you with criminal
Unlawful Practices prosecution. The debt collector
cannot deposit a postdated check
Both the Washington Collection Agency Act
before the date on the check. Also, a
and the Federal Fair Debt Collection
collector’s acceptance of your
Practices Act prohibit harassment, false or
postdated check violates the law
misleading statements and unfair practices
unless you had three to ten business
by collection agencies. If you believe that
days’ notice before the collector
you are being unreasonably harassed or
deposited the check.
misled by a collection agency, you can sue
the collection agency. If you win, the law If you believe that your rights under the
says you can collect damages and lawyer Washington Collection Agency Act,
fees. Here are some examples of violations: Consumer Protection Act, or Fair Debt
Collection Practices Act have been violated,
1. the collection agency threatens to
or you are sued on a debt you do not
tell your employer or neighbors
believe is valid, contact a lawyer. Agencies
about the debt, or actually does tell
which take complaints about violations of
them about the debt;
the Fair Debt Collection Practices Act and
2. the collection agency calls at hours the Washington Collection Act are:
the law has defined as
“unreasonable” ( 9:00 p.m. - 8:00
a.m. under the federal law; 9:00
p.m. –7:30 a.m. under state law);
3. the collection agency threatens you
with illegal action ( example:
threatening to take money out of
your Social Security check, taking
other exempt property, or
threatening arrest or jail).
4. the debt collector communicates
with you or anyone else in your
household in a way that harasses,
intimidates, threatens, or
embarrasses you.
5. the debt collector communicates
with you or your spouse more than
three times in one week.
6. the debt collector sends you notices
that deliberately look like
4
Department of Licensing Federal Trade Commission
Collection Agency Board 915 Second Avenue, Room 2806
PO Box 9034 Seattle, Washington 98174
Olympia, WA 98507-9034
Mail to the Consumer Resource
Center nearest you:
Bellingham - Island, San Juan, Skagit and Spokane - Northeast Washington
Whatcom Counties Address:
Address: West 1116 Riverside
103 E. Holly Suite 308 Spokane, WA. 99201-1194
Bellingham, WA. 98225 Telephone: 509-456-3123
Telephone: 360-738-6185 Fax: 509-458-3548
Fax: 360-738-6190
Tacoma - Pierce, Mason, Grays Harbor and
Kennewick - Southeast Washington Kitsap Counties
Address: Address:
500 N. Morain St. Suite 1250 P.O. Box 2317
Kennewick, WA. 99336-2607 Tacoma, WA 98401
Telephone: 509-734-7140 Telephone: 253-593-2904
Fax: 509-734-7285 Fax: 253-593-2449
Seattle - King, Snohomish, Clallam and Vancouver - Thurston, Lewis, Pacific, Cowlitz,
Jefferson Counties Skamania, Clark and Wahkiakum
Address: Address:
900 Fourth Ave. Suite 2000 1220 Main St. Suite 549
Seattle, WA. 98164-1012 Vancouver, WA. 98660-2964
Telephone: 206-464-6684 Telephone: 360-759-2150
Fax: 206-464-6451 Fax: 360-759-2159
5
What can I do on my own? income people seeking free legal assistance
with civil legal problems.
Your success in an unfair debt collection
practice claim often depends on the • Outside King County: Call 1-888-201-
strength of your proof a violation has 1014 weekdays from 9:10 a.m. until
occurred. You should do some or all of the 12:25 p.m. CLEAR works with a
following: language line to provide interpreters
as needed at no cost to callers. If
1. Set up a place to keep all notes or
you are deaf or hard of hearing,
letters from the collection agency.
please call 1-888-201-1014 using
Keep all written material you get
your preferred TTY or Video relay
from them, including the envelopes.
service.
2. Make notes of every phone call from
the collection agency, including the • King County: Call 211 for
date, time, content and names of information and referral to an
people involved in the appropriate legal services provider
conversations. Monday through Friday from 8:00
am – 6:00 pm. You may also call
3. Make notes of the same information
(206) 461-3200, or the toll-free
if you learn that the collection
number, which may be useful when
agency has contacted anyone other
calling from a pay phone, 1-877-211-
than you.
WASH (9274). 211 works with a
4. If the stress of dealing with a language line to provide interpreters
collection agency begins to result in as needed at no cost to callers. Deaf
physical, mental or emotional and hearing-impaired callers can call
problems for you, see a counselor or 1-800-833-6384 or 711 to be
physician of your choice. Discuss the connected to a relay operator at no
situation thoroughly with them. cost, who will then connect them
What if I need Legal Help? with 211. Information on legal
service providers in King County may
• Apply online with CLEAR*Online - also be accessed through 211’s
[Link] website at
help [Link]/win211/.
or
• Persons 60 and Over: Persons 60 or
• Call CLEAR at 1-888-201-1014
over may call CLEAR*Sr at 1-888-
387-7111, regardless of income.
CLEAR is Washington’s toll-free, centralized
intake, advice and referral service for low-
0200EN
This publication provides general information concerning your rights and
responsibilities. It is not intended as a substitute for specific legal advice.
This information is current as of the date of its printing, June 2012.
© 2012 Northwest Justice Project — 1-888-201-1014
(Permission for copying and distribution granted to the Alliance for Equal Justice and to individuals for non-commercial
purposes only.)
2
Form letter #1: No-contact letter, verification request.
The following letter is a no-contact letter form that you can use with collectors. Check the
boxes next to appropriate language in the letter if that language applies in your case.
This letter includes a general request for verification. If you have specific disputes (for example,
if you want to dispute that this is your account), you should request information related to
those in the verification request, and mention those specific disputes in the letter.
TO:_____________________ By Certified Mail RRR
_________________________ #_________________
_________________________
_________________________
RE: ACCOUNT #_________________________
Dear Sir or Madam:
I am writing to request that you stop communications to me regarding my account. The Fair
Debt Collection Practices Act, 15 U.S.C. §1692 et seq., requires that you honor my request.
Under the Fair Debt Collection Practices Act, once I have asked you to stop contacting me, you
may only communicate with me to (1) advise me that your further efforts are being terminated,
(2) notify me that you may invoke specified remedies that you normally invoke or (3) where
applicable, to notify me that you intend to invoke a specified remedy.
Please provide me with the following:
(1) Verification of any debt relating to my account;
(2) The name and address of the original creditor and the current
creditor;
(3) Confirmation that any such debt and the accuracy of the items in the
files relating to me will be treated as disputed; and
(4) Forms and assistance I can use to dispute the accuracy of such items.
Until advised otherwise, you should consider this debt to be disputed.
Furthermore, I have been the victim of abusive collection practices by agents of
your company. Specifically:
_________________________________________________
You should know that such practices violate Federal law and place you in jeopardy of legal
liability.
I also wish to inform you that my sole source of income is Supplemental Security
Income (SSI)/ Social Security. As a result, my income is exempt from garnishment
for this type of debt. I have no non-exempt assets.
Thank you for your cooperation.
Sincerely,
Dated: ____________________________ (print name)
(street address)
(city, state & zip)
Form letter #2: No-contact letter, no verification.
You can choose to use the following no-contact letter form to deal with collectors. Check the
boxes next to appropriate language in the letter if that language applies in your case.
Note: This form letter does not include a request for verification.
TO:_____________________ By Certified Mail RRR
_________________________ #_________________
_________________________
_________________________
RE: ACCOUNT #_________________________
Dear Sir or Madam:
I am writing to request that you stop communications to me regarding my account. The Fair
Debt Collection Practices Act, 15 U.S.C. §1692 et seq., requires that you honor my request.
Under the Fair Debt Collection Practices Act, once I have asked you to stop contacting me you
may only communicate with me to (1) advise me that your further efforts are being terminated,
(2) notify me that you may invoke specified remedies that you normally invoke or (3) where
applicable, to notify me that you intend to invoke a specified remedy.
Until advised otherwise, you should consider this debt to be disputed.
Furthermore, I have been the victim of abusive collection practices by agents of
your company. Specifically:
.
You should know that such practices violate Federal law and place you in
jeopardy of legal liability.
I also wish to inform you that my sole source of income is Supplemental Security
Income (SSI)/ Social Security. As a result, my income is exempt from garnishment
for this type of debt. I have no non-exempt assets.
Thank you for your cooperation.
Sincerely,
Dated: ____________________________ (print name)
(street address)
(city, state & zip)