Debt collection can be a touchy subject, and many people fear dealing with debt collectors. The debt collector is someone who is hired to collect the debt on behalf of the original creditor. Debt collectors may have student loans, a mortgage, auto loans, credit cards, and more. Let’s get to know more about debt collection in Sydney.
What is Debt Collection?
Debt collection is a process used by creditors to collect on outstanding debts. The debt collection process can occur in a consumer’s home, place of business, or through the mail. In Australia, debt collection agencies are bound by laws to limit the debt they can pursue against a debtor. However, suppose a debtor fails to comply with the collection agency’s orders. In that case, debts can spiral out of control, resulting in the debtor being in a position where they are unable to pay the debt, including other debts, and frequently the creditors will increase their original debt.
Most debt collection companies will first attempt to reach the consumer via phone or letter. Then if these efforts fail, the consumer will receive either correspondence or phone calls, including threats of legal action.
What Are Your Rights and Responsibilities When Dealing with Debt Collection?
Debt collection agencies are hired by creditors to collect outstanding debt. Debt collection can be extremely stressful and can lead to reputational damage since often, consumers perceive debt collectors as aggressive and harassing. According to Fair Debt Collection Practices, debt collectors are prohibited from harassing you or publishing or disclosing personal information about you to anyone unless legally required. But debt collection agencies also have to act within certain legal and ethical parameters, and consumers have certain rights and protections under the law.
Debt collection in Sydney is regulated and monitored, and that is a good thing. Debt collectors must adhere to a number of rules and regulations, which define how they collect a debt, the amount and frequency of contact that is allowed, and what to do if the debt is disputed. Debt collectors are also required to inform consumers of their rights, including that they are allowed to ignore debt collectors when they contact them. As everything can be solved through proper communication, make sure that you communicate with the debt agency to settle things peacefully.