It Just Got A Lot Easier To Get Debt Collectors Off Your Back

The Consumer Financial Protection Bureau became the third federal agency to take complaints from consumers on unfair debt collections practices on Wednesday, just a day after its co-watchdog, the Federal Trade Commission, slapped the largest debt collector in the country with a record $3.2 million civil fine for violating the Fair Debt Collections Practices Act.

The CFPB is also cracking down on banks and other direct lenders for collections practices. Most regulations target third-party collectors for illegal practices, leaving direct lenders who decide to collect debts on their own in a weird gray area.

"These bulletins make clear that it doesn't matter who is collecting the debt - unfair, deceptive, or abusive practices are illegal," CFPB Director Richard Cordray said at a hearing in Portland, Maine. "Consumers need options to help them secure fair and respectful treatment from those debt collectors that fail to abide by the law."

It's a positive step, to be sure. In addition to setting up a consumer complaint form on its site, the CFPB has even rolled out a handful of template letters consumers can use to get harassing debt collectors off their back.

As of 2012, about 30 million consumers have an average of $1,400 of debt under collection, according to the CFPB.

So, when exactly does a debt collector cross the line between just doing its job and breaking the law?

Here are some valid reasons to report a debt collector:

-They repeatedly call to harass you, even after you've asked them to stop.

-They try to recoup more money than you actually owe.

-They threaten violence or some other exaggerated consequence, such as wage garnishment, jail time or damage to your credit score.

-They use obscene or abusive language.

-They make false promises that debts will be forgiven if consumers settle.

-The call before 8 a.m. or after 9 p.m.

-They divulge your debt to third parties, such as family, coworkers or friends they may contact in order to track you down.

-They call you at work after you've asked them to stop.

-They won't verify debts that you choose to dispute.

-They ignore your continued pleas to stop contacting you.

How to report a debt collector:

Contact the CFPB, the FTC, or your state's attorney general.

Here are the letters you can use to get debt collectors off your back:

• Needs more information on the debt: This letter states that the you are disputing the charges until the debt collector answers specific questions about what is owed.

• Wants to dispute the debt and for the debt collector to prove responsibility or stop communication: This letter tells the collector that you are disputing the debt and instructs the debt collector to stop contacting you until they provide evidence that you are responsible for that debt.

• Wants to restrict how and when a debt collector can contact them: This lets you tell the debt collector how and when you would like to be contacted.

• Has hired a lawyer: This letter template gives you a way to give the debt collector the lawyer's information and tell the collector to contact only the lawyer.

• Wants the debt collector to stop any and all contact: You have the right to tell a debt collector to stop all communication. It doesn't get rid of your debt, but it does help get them off your back. This is your first line of defense against harassing collectors.