What rights do Servicemembers have when dealing with debt collectors?

June 16th, 2021 by
What right do Servicemembers have when dealing with debt collectors?

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When it comes to collections by creditors, it can be detrimental to those who serve our country.

If you are in the armed forces and you have trouble with your personal finances, it can put your duty status, potential promotions, or even your military career in danger.

If you are contacted by a debt collector, the best course of action is to take action!

Do not ignore the communication in hopes that they will give up or that the debt will go away. 

Related: What to know about the Servicemembers Civil Relief Act (SCRA)

The best line of defense in a situation like this is to know exactly what a debt collector can and cannot do, especially if you are an active member of the military.

Being in the service there are certain restrictions that a debt collector cannot do, the Consumer Financial Protection Bureau says. These are:

  • Inform your chain of command that you owe a debt.
  • Threaten you with prosecution under the Uniform Code of Military Justice.
  • Threaten you with action that they have no control over such as security clearances or pulling your rank.

What to do if you are contacted by a debt collector

If you are contacted by a debt collector, take the following action:

  1. Gather as much information in regards to the debt and to the collection agency.
  2. Get the full name of the person who contacted you, along with the name and address of the collection agency they are working for.
  3. Get the debt details, like the amount owed, the name of the company you owe money to, and how you can dispute or verify the debt. It would be best for you to request this information in writing before you pay the debt or try to negotiate repayment plans.

What should you do if it is a debt that you truly owe?

You need to pay it or make arrangements to pay it off in installments.

If the debt is several years old, you may want to do some research to see what are the state’s statute of limitations in filing a lawsuit against you.

Related: Protect Yourself From Mortgage Closing Scams

Some debt collection agencies will bet that you will not do the legwork to find out and hope that you will just pay the debt.

If the statute of limitations has passed, they will need to write off the debt and there will be no case filed against you.

You may want to consult your local Judge Advocate General’s Corps (JAG) office to find out the specific laws in your state.

If the debt is not yours, contact the debt collector and state that it is not yours and that you do not want to be contacted again in regards to this matter.

Related: Identity Theft Affidavit Explained

Doing this may stop them from contacting you but the debt may still continue to be there.

It is also recommended that you keep copies of all written correspondences to the debt collector as well as all correspondences from the debt collector in case you need to go back to dispute the debt.

Knowing what a debt collector can and cannot do can make you feel more in control of your financial situation and proceed with confidence in fixing the issue.


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