Debt Collection: Know Your Rights
If you are behind in paying your bills, someone will probably contact you to collect the money you owe. You might owe money on a car loan, credit card accounts, medical bills, utility bills, mortgage, or others.
This booklet explains your rights about debt collection and
- what you need to know if a debt collector contacts you,
- which bills you should pay first,
- what you can do if you don't think you owe the debt,
- what you can do if you cannot afford to pay the debt,
- what debt collectors can and cannot do, and
- what happens if you are sued by the debt collector.
I've been contacted about a debt. What do I need to know?
You may be contacted directly by a creditor or by a collection agency.
- A creditor is a company you owe money to, like a credit card company.
- A collection agency is a separate company that is in the business of collecting debts.
Both are also called debt collectors.
Your rights can be different depending on if you owe money to a creditor or to a collection agency. Debt collectors will try to collect money from you even if you don’t have the money or you think you don’t owe anything.
Which bills should I pay first?
If you cannot pay all your bills at once, you must decide which bills to pay first. Think about what will happen if certain debts are not paid, and ask yourself which unpaid bills will affect your family the most.
You might want to pay your bills in this order:
1. Bills that affect your family’s health: Food, medication, health insurance.
2. Bills that affect your family’s housing: Rent, mortgage, condo fees, real estate taxes, and utilities such as heat and electricity.
3. Other bills: Car payments if the car is important (for example, if you need a car to get to work), child support, income taxes, and government-insured student loans.
If you have money left over after paying these bills, you can decide how much money you can pay to each of the other debt collectors.
You may want to learn how to budget your debts.
Call or visit:
The University of Connecticut Cooperative Extension System
305 Skiff Street
North Haven, CT 06473
You can also read about budgeting.