Dear Debt Adviser,
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If a collection agency wants to make arrangements to pay off a debt and I have no income whatsoever, why do they keep sending me letters? I have a car and the title is in my name and my daughter's name. Can the debt collectors take it? I have not had a job for three years and have received no unemployment. What else can I tell them so they will stop calling me?
Dear Concerned, I think the debt collector doesn't believe you. And to some extent, neither do I. Three years is a long time to have had no income at all. You may have had a big emergency savings account, but most people can't go without a paycheck for 36 months.
If, however, you haven't actually seen a dime of income since 2008, I suggest that you consider looking at any position that will get you a paycheck and get you back into the employed category, regardless of what type of work it is and whether you like the job or not. Being out of work for that long becomes harder and harder to explain to a prospective employer. Explaining that you took a job to make ends meet makes you look much better in a job interview situation.
Expect the debt collector to keep writing letters and calling until you pay the debt you owe. After all, from their point of view, you received goods or a service and promised to pay for it, but didn't. The debt collector is simply trying to collect on that promise. Even if your financial situation has changed and you are no longer able to fulfill your obligation, that doesn't change the fact that the obligation exists.
To answer your question regarding taking your car, the short answer is no; in most cases, the collector cannot repossess or take the car. The exceptions would be if the defaulted debt is a loan that was used to purchase the car, or if the debt is the result of a title loan, where the car was put up as security for the loan.
You do have some options to get the collector to stop contacting you regarding the debt. The Fair Debt Collection Practices Act provides that if you request in writing that the collector no longer contact you regarding a debt, the collector must cease communication with these exceptions:
- To notify you collection efforts are being terminated.
- To notify you of a specific action being considered or taken, such as suing you in court.
Collectors also must stop contacting you directly if you inform them that you are represented by an attorney and provide the attorney's contact information. This option will, of course, only apply if you actually have an attorney for the collector to call.
Or, you can inform them in writing that you are filing for bankruptcy. This will stop all contact, but they will be looking to see if you follow through.
Lastly, you can always just stop answering the phone when you know it is the debt collector calling. You could also stop opening mail from the debt collector, but I don't recommend that. The main reason being you will want to know if they decide to sue you to collect.
Should the collector decide to sue you, be sure to appear in court or provide the requested documentation to the court regarding the case. If you don't, the court will award a default judgment to the debt collector. You may not have any assets for the debt collector to attach or an income for them to garnish at the present time, but at some point you will. So you will still want to avoid a judgment against you if you can.