Consumer Financial Literacy

April is National Financial Literacy month and a great time to remind consumers of the importance of taking charge of their personal financial well-being. Among the important aspects American consumers should know is what to do if contacted by a debt collector about a delinquent or defaulted account.

“While no one really wants to get a call or letter telling them they owe money, consumers need to know they are not alone,” ACA International CEO Pat Morris said. “Each year, for many very legitimate and often unavoidable reasons, millions of consumers fall behind on payments and are contacted by a debt collector.”

ACA International offers helpful tips for consumers to help effectively manage contact from third-party debt collector should the need arise. A third-party debt collector is unique in that they are service provider hired by the owner of the debt (i.e., a creditor or debt buyer) to recover a rightfully owed debt on their behalf.

Know Your Rights. Consumers have important rights under federal and state law, and deserve to be treated respectfully. By law, consumers cannot be harassed, threatened or be subjected to profanity and vulgar language.

For more information about consumer rights in debt collection or to ask questions, visit

Communicate. If you hear from a debt collector, avoiding a letter or call won’t make the debt disappear. The reason for the contact cannot be resolved without the ability to communicate; whether it’s to pay an owed debt, verify an alleged debt or confirm that the debt collector has reached the wrong person.

Identify. Debt collectors cannot call anonymously nor present themselves as being a representative of a government entity. When contacted, collectors must identify themselves and the name of the collection agency they represent.

Notify the Collection Agency if you Dispute the Validity of the Debt. By law, the collector must inform you of your right to dispute the debt and provide written verification if you dispute it in writing. All collection activity stops until this verification is provided.

Seek to Work Out Complaints with the Collection Agency. Third-party debt collectors sincerely want to work with consumers to resolve complaints. According to a report by the Council of Better Business Bureaus, in 2012 collection agencies resolved 86 percent of the consumer complaints received by the BBB.

Protect Your Identity. Do not confirm or provide sensitive personal information (e.g., Social Security number, credit card numbers, and bank accounts) until certain of the authenticity of the debt and the person seeking to collect. Check out whether the collector is a legitimate agency by using the Internet to search the company name or visit to see if they are a member. Monitor accounts and immediately report any suspicious or unauthorized purchases to your bank or credit card provider. Importantly, consumers are entitled to a free credit report each year at If you believe your identity has been stolen, contact your local police department and visit for information on what you should do.