Dealing with a call from someone claiming to be a debt collector can be challenging. It’s not always easy to tell whether the caller is a legitimate debt collector or a scammer.

Go slowly and know your rights. Take the time to verify everything you’re told, and to consider your options.

Debt collectors will never win a popularity contest, but they have a job to do. When you fall behind on paying a bill and don’t respond to the creditor’s requests for payment, the creditor may hire a debt collector or sell the debt to a company that will try to collect.

Many debt collectors follow the law, but as the Federal Trade Commission’s (FTC) website cautions, “Others engage in illegal conduct.” Last year, the FTC received more than 471,000 complaints related to debt collection. “All too often,” the FTC noted, “people pay collectors money they don’t owe, and fall deeper in debt.”

The most common grievances include demands for more than is owed, harassing phone calls, verbal threats, refusal to verify disputed debts, illegal disclosure of debts (to employers, co-workers, friends, or other family members), and false claims that nonpayment could result in arrest.

The debt collection industry blames “industry outliers” who don’t follow the rules and scammers for most of the complaints.

What to Do When You’re Contacted by a Debt Collector

Debt collection can be intimidating, but you can’t make your debt go away by ignoring phone calls and letters. That said, you need to be careful about how you respond and what information you provide.

Legitimate debt collectors identify themselves and their company. They’re happy to provide contact information. The collector already has your full name and address, and won’t ask for personal information, such as your Social Security number or bank account number.

Red Flag: Scammers or disreputable collectors will threaten to tell your family, friends, employer, or coworkers about your debt. Don’t respond to this high-pressure tactic.

Remember, nothing needs to happen immediately, no matter what the caller says.

“Politely decline to continue further conversation until you’ve had a chance to look into the company and its allegations that you owe a debt,” said Daniel Dwyer, an attorney in the FTC’s financial practices division. “Hang up and search online to verify the information you received.”

Don’t pay anything or provide any personal information until you receive basic information about the alleged debt and your right to dispute it. Federal law, the Fair Debt Collection Practices Act, requires debt collectors to provide specific information by letter, email, or phone. The collector must tell you:

• The name of the original creditor to whom the debt is owed
• Account number (if any) associated with the debt
• Name and address of the debt collector
• The balance owed as of a specific date, as well as an itemized list of all fees, interest, and credits
• Information about your rights and how to dispute the debt 

Prior to 2021, this “validation” information was required to be in writing, but it can now be provided verbally. If your first contact with a debt collector is via phone, the National Consumer Law Center (NCLC) recommends asking for a written or electronic copy of the validation notice.

Having the information in writing will make it easier to review the alleged debt, research your rights, and consult others before deciding what to do.

You have the right to dispute all or part of the alleged debt, noted April Kuehnhoff, a senior attorney at NCLC. For example, you may acknowledge owing money on a credit card bill, but question the amount listed. Dispute it in writing right away.

Tip: If you suspect you are dealing with a scammer, the Consumer Financial Protection Bureau (CFPB) suggests contacting the original creditor to find out if that debt collector is really working for it. The CFPB has a tip sheet that explains how to tell the difference between legitimate debt collectors and scammers.

Know Your Rights

The FTC enforces the Fair Debt Collection Practices Act (FDCPA), which prohibits various deceptive, unfair, and abusive debt collection practices. For example, collectors cannot attempt to collect interest, fees, or other charges on top of the amount owed unless the original contract with the lender or state law permits it. And they cannot threaten to take your property unless those practices are legal in your state.

A debt collector can contact you by phone, mail, email, or text message, but the FDCPA says they cannot:

• Call before 8 a.m. or after 9 p.m., unless you agree
• Call you at work, unless you agree to be contacted there
• Threaten you with violence or harm
• Use obscene or profane language
• Misrepresent the amount you owe
• Lie about being attorneys or government representatives
• Claim you’ll be sued, or that your wages could be garnished, unless the collector intends to do so

While there is no hard limit on the frequency of calls, more than seven “attempts” to call the consumer within seven consecutive days about a specific debt is presumed to be harassment, according to a CFPB rule.

Your Right to Stop Communications 

Debt collectors must comply with your request to stop specific types of contact, such as all phone calls, calls to a cellphone, texts, or emails. You can make this request by phone. Collectors are required to notify you about your right to opt out of electronic communications and provide a simple method to do so. To stop all communication, you must make that request in writing. The company is still allowed to inform you of a pending action, such as filing a lawsuit.

If you tell the collection agency you’re represented by an attorney, the collector must communicate with your lawyer, not you (unless the attorney fails to respond within a reasonable amount of time).

In a Debt Collection Q&A, the FTC advises talking to the collector at least once, even if you don’t think you owe the debt or can’t repay it immediately, so you can figure out whether it’s really your debt. If it’s not, you can take steps to dispute it.

Note: Stopping unwanted contact from the collector will not make the debt go away. If you challenge the debt within 30 days of your first contact with the collector, the collector cannot continue to request payment until the dispute is resolved.

If this is your debt, you can find out more information about it from the collector. Just be careful about sharing your personal or financial information.

You Have Privacy Rights

In general, a debt collector cannot discuss your debt with anyone but you or your spouse.

The only reason a collector can reach out to anyone else is if they don’t have adequate contact information for you—and even then, the law prohibits mentioning the debt.

Some Debt Is Too Old to Collect

A creditor can file a civil lawsuit against someone who doesn’t pay their debt, but only for so long. This ranges from three to 15 years for claims based on written contracts, depending on the state where the debtor lives.

Once a debt is older than the statute of limitations, it is “time-barred,” meaning collectors cannot threaten to sue or take legal action against a consumer for that debt. That would be considered an unfair and deceptive trade practice. But, as the NCLC’s Kuehnhoff cautions, collectors can still pressure people to make payments, using tactics that are likely to confuse them.

In some states, if you agree to make a small payment or otherwise acknowledge the debt, you can end up “reviving” that old time-barred debt—restarting the statute of limitations and allowing the collector to sue.

Her advice: If you get contacted by a collector, make sure you really owe the money. If you do, verify that the collector is asking for the correct amount. Then look at how old the debt is. It could be beyond the statute of limitations. When in doubt, get some legal advice before doing anything.

Armed with the facts, you can decide whether to dispute the debt, ignore it, or set up a payment plan. And yes, you can negotiate. Many collectors will agree to settle for significantly less than what you owe.

Scammers Pretend to Be Debt Collectors

Fake debt collectors will try to bully you into paying a debt you don’t owe. These scammers often claim to be calling from a law firm with a legitimate-sounding name.

Armed with information stolen in data breaches, they may have a wealth of personal information, including the last four digits of your Social Security number, which can make the phony collection attempt appear legitimate.

“Even for people who know they don’t have any outstanding debt, the con artists are so convincing—or threatening—when they call, that some people suspect someone else may have taken out loans in their name,” said John Breyault with Fraud.org.

Based on recent FTC lawsuits, these debt-collection impostors are stealing millions of dollars from consumers who don’t owe any debt.

“People tell us they’ve gotten an unsolicited phone call saying they owe a debt and the caller was threatening them with either criminal prosecution or embarrassment, if they didn’t pay immediately,” said Amy Nofziger, senior director of fraud victim support at the AARP Fraud Watch Network. “And all too often, they do pay simply because they’re afraid, even when they don’t owe the debt.”

Red Flag: Legitimate debt collectors will accept checks, credit cards, or debit cards. Scammers often insist on some other form of payment, such as a wire transfer, a payment app, a gift card, a prepaid debit card, or Bitcoin. These are methods favored by scammers because they’re untraceable and difficult to reverse. Never pay this way, no matter what the caller threatens. Remember, failing to repay a loan is not a criminal offense. That’s why making such a threat is illegal.

If you’ve fallen victim to a collection scam or have been threatened, harassed, or lied to by a debt collector, file a complaint with the Federal Trade Commission.

Help is Available

Even if your debt has been sent to collections, a non-profit credit counselor may be able to help you find a way forward.

“While the ability to include that specific account in a formal repayment plan depends on the agency’s policies, a counselor offers the vital budget review and strategic coaching needed to navigate the collection process and regain financial control,” said Bruce McClary, vice president of communications at the National Foundation for Credit Counseling (NFCC). You can find a certified credit counselor at NFCC.org. The initial consultation is free.

More Info: 

AARP: Debt Collection Scams

National Consumer Law Center: Stopping Debt Collection Harassment 

Federal Trade Commission: Debt Collection FAQs