Debt Collection Practices To Avoid


Whether you are planning to collect debts that are owed to you on your own or planning to hire a debt collection agency, it is always in your best interest to avoid any practices, which might be considered unethical or even illegal.

Collecting debts can be a very stressful and frustrating process. It is incredibly aggravating to waste your time collecting money that you already earned. It can be even more aggravating to have to pay someone else to collect your money. You might feel yourself tempted to take shortcuts in an effort to get your money back sooner. However, most of these shortcuts end up making the situation even worse.

The key to successful debt collection is to treat the other party with dignity and respect, even if they don’t deserve it. With that in mind, here are some practices that are more likely to worsen your situation than improve it:

Calling At Inconvenient Times

Phone calls to debtors before 8 AM and after 9 PM are considered inconvenient. It is also considered inconvenient if you attempt to contact a debtor after they have referred you to a lawyer, or if you attempt to contact them at work if their employer forbids collection calls.

Most commercial debt collection agencies are aware of these rules and abide by them. However, many individuals who are attempting to collect debts on their own will throw out the rules and call at all hours of the night. Many times creditors will make repeated calls in an attempt to annoy a debtor into payments. This almost always backfires.

The bottom line here is that the best way to get an outstanding debt paid is to treat the debtor with respect. This is the only way that ends with them wanting to pay you. If they still don’t make an effort to pay you, then calling them in the middle of the night is certainly not going to convince them.


This goes hand-in-hand with calling at inconvenient times. If you threaten, swear at, or even raise your voice towards your debtor, the odds of collecting the debt will plummet. Threats and foul language breed a hostility that causes the debtor to resent you. Once this situation arises, the debtor will go out of their way to avoid making payments.

Debt collection is far more effective when conducted in a professional manner. Leave the threats and swear words aside and treat your debtor with dignity. You might be surprised to find a real person who is willing to work with you.

Misrepresenting Yourself

This should be obvious, but it is completely illegal to give a debtor the impression that you are an attorney, police officer, or any type of court official. While it may seem like a good idea in the heat of the moment, this type of practice will not intimidate your debtor and may end in you suffering legal consequences. No matter how frustrating your debtor is, two wrongs don’t make a right.

Unfair Practices

These are lesser-known lines that vary from state to state. It is generally illegal to make a debtor accept collect calls or pay for mailings that were an attempt to contact them. In some states, it is illegal to add any extra fees to the debt that is owed.

As you can see, there are lots of rules and regulations when it comes to collection debt. One of the best ways to make sure that you are in compliance with all of your local laws is to hire a competent debt collection firm. They will attempt to collect the debt in a professional manner and you will be able to stay out of the process and focus on running your business.

By |2017-02-12T14:41:09+00:00August 28th, 2013|Blog|0 Comments

About the Author:

Graduated from University of Utah - business degree 1990. Served in US Army as an interrogator / linguist, then as a tactical intelligence officer - Military Intelligence 1986-1990. Managed Western US sales operations for NY based collection agency 1990-1992. Founded Direct Recovery Associates, Inc. 1992-present