Making Monthly Payment Arrangements on your Debt

Being contacted by a debt collector can be a scary and definitely intimidating confrontation.  Consumers often times get nervous and agree to things that they would not normally agree to had they not been under duress.  A common request of collectors when a consumer pleads an inability to pay is a demand for post-dated checks or other payments that the collector will deposit or remove from the account over time.  Lately, collectors have been demanding that the consumer provide bank account routing information or a debt card number and will agree to withdraw payments monthly.  To the collector, a bank account number can provide more of a guarantee, even if there is no money for payment in the account at the time, that there will be some payments made toward the debt. 

Under the Fair Debt Collection Practices Act, (“FDCPA”) the law provides that a collector who accepts payment by a post-dated instrument must provide notice to the consumer of the intent to deposit the check or take the payment from the account, in writing, at least three and no more than ten days before the deposit.  This allows the consumer ample time to make sure enough funds are in the account to cover the payment.     

The FDCPA also requires that a debt collector not threaten a consumer in an effort to receive a post-dated check.  It is not a crime to be unable to pay your bills, a collector cannot threaten to put a consumer in jail for failure to make payment.  If a collector threatens to criminally prosecute in an effort to make the consumer provide post-dated checks, the collector has violated the law.  Furthermore, if a collector solicits a post-dated payment instrument – whether it’s a check or an automatic withdrawal, a debt collector cannot take that money prior to the agreed upon date.  Depositing a check prior to the agreed upon date is a violation of the FDCPA and the consumer can file suit against the collector for damages

Providing debt collectors with post-dated checks or permission to make automatic withdrawals on your account is not a great idea.  You are giving a strange person your private banking information.  Though you may be working with a reputable collection agency that must take some care in protecting your information, you did not screen those employees, and you don’t know what they may be capable of. It is not out of the realm of possibility for a rogue employee to take off with information it was given while collecting debts.  Avoid violations of the FDCPA by being responsible for making your own payments.  If you feel your rights have been violated under the FDPCA and you would like the advice or assistance of counsel, contact SmithMarco P.C. for a completely free case review.