Guidelines for collection of business debt

While collecting small business debts, some practices to be followed are as follows:

• The collector must collect the actual amount only. If they are collecting more than the actual, they should have the legal rights to do so.
  
  
• If you have disputed on a particular item, all collection attempts should stop before the item is verified with the original creditor.
  
  
• After sending you the details of the debt, the collector must not call you in the next 30 days when you are reviewing it closely.
  
  
• The collector must not credit payment from an undisputed debt to a debt that is already disputed.
  
  
• Depositing post dated checks before the post dates are not allowed.
  

Like the fdcpa laws on debt collections, all the restrictions on the collectors apply here as well. Some of the common ones that are illegal are:

• Use false names.
  
  
• The collector presenting themselves as attorney when actually they are not
  
  
• The debtor has committed crime unless there are records to prove it.
  
  
• The collectors must not relate themselves working with the CRA.
  
  
• The collector must not falsely comment that legal forms have been sent to the debtor.
  
  
• No arrest threats should be made.
  
  
• No threats of garnishment, seizing, or attaching debtor's property.
  
  
• Threats to sue you unless the collector really intends to do so.
  

For a better explanation on the fair debt collections, read the FTC website and get a wider understanding.