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Debt Collection

A debt collector (or collection agency) is someone who collects debts owed to others and may contact you if you are late in paying your bills.  The federal Fair Debt Collection Practices Act (FDCPA) requires that they treat you fairly and prohibits certain methods of debt collection.
Maryland has also passed the Maryland Consumer Debt Act that further protects you from abusive debt collection practices.

Under the Fair Debt Collection Practices Act (FDCPA):

  • What type of debts are covered?  Personal, family, and household debts are covered.
  • What is a validation notice?  Within 5 days of the debt collector’s first contact, he or she must send you a written “validation notice” telling you the amount of money you owe, the creditor to whom you owe the money, and what to do if you believe there was a mistake and you don’t owe the money.
  • Can a debt dollector contact someone else about my debt?  If an attorney is representing you about the debt, the debt collector must contact the attorney, not you.  Otherwise, the collector may contact other people to obtain your address, your home number, and where you work.  Collectors are generally prohibited from discussing your debt with anyone other than you, your spouse, or your attorney (except to obtain that information) and from contacting third parties more than once.
  • Can I stop a debt collector from contacting me?  If you don’t want the debt collector to contact you, write a letter to them, make a copy of your letter, send the original by certified mail, and pay for a “return receipt,” for documentation.  Once this letter is received, the collector may not contact you again other than to inform you that there will be no further contact or to that they or the creditor intend to take a specific action.  Stopping contact with the collector does not erase the debt.  The creditor or the collector can still sue you to collect the debt. 
  • How are my payments applied?  If there is more than one debt the debt collector is trying to collect from you, he or she must apply any payment you make to the debt you choose and may not apply a payment to a debt you think you don’t owe.
  • What if I do not owe the money?  Within 30 days after receiving a notice that you owe money, you should send the debt collector a letter stating that you don't think that you owe any or part of the money and asking them to verify the debt.  The debt collector must stop contacting you after they receive this letter.  The collector will need to verify the debt.  To verify a debt, the collector will need one of the following:
    • ​Proof that the debt collector owns or has been assigned the debt;
    • Statement from the original creditor;
    • Copy of the original signed loan or credit card application; or
    • Copy of a canceled check from you to the original creditor.

The Maryland Consumer Debt Collection Act  covers debt collectors (collecting a debt for others), creditors themselves ( including employees hired by the creditor ) , and attorneys who collect debts for others.  This provides more coverage than the FDCPA, which only covers third party debt collectors, and does not apply to a creditor collecting its own debts.   For more information, see this Consumer Advisory by the Maryland Commissioner of Financial Regulation .

The Maryland Collection Licensing Act requires collection agencies  (those collecting a debt for others or collecting debt purchased from others)  to be licensed to do business in the state. (Annotated Code of Maryland,  Title 7, Business Regulations Article )

Liability for damages under the law:

A collector who violates any provision of the Maryland law is liable for damages proximately caused by the violation, including damages for emotional distress or mental anguish suffered with or without accompanying injury.

If a lawsuit is filed against you (by the collector), respond to it personally or through a lawyer by the date specified in the court papers in order to preserve your rights and have th e opportunity to fight court orders such as wage garnishment. Your bank account or wages can be garnished (by court order only) if you do not pay your debt. Many federal benefits are exempt from garnishment but may be garnished under certain circumstances to pay alimony, child support, student loans, or delinquent taxes.  See our page on Garnishment for additional information.

Harassment. Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:

  • use threats of violence or harm;
  • publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
  • use obscene or profane language; or
  • repeatedly use the phone to annoy someone.
False statements. Debt collectors may not lie when they are trying to collect a debt. For example, they may not:
  • falsely claim that they are attorneys or government representatives;
  • falsely claim that you have committed a crime;
  • falsely represent that they operate or work for a credit reporting company;
  • misrepresent the amount you owe;
  • indicate that papers they send you are legal forms if they aren’t; or
  • indicate that papers they send to you aren’t legal forms if they are.
Debt collectors also are prohibited from saying that:
  • you will be arrested if you don’t pay your debt;
  • they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or
  • legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.
Debt collectors may not:
  • give false credit information about you to anyone, including a credit reporting company;
  • send you anything that looks like an official document from a court or government agency if it isn’t; or
  • use a false company name.
Unfair practices. Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:
  • try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
  • deposit a post-dated check early;
  • take or threaten to take your property unless it can be done legally; or
  • contact you by postcard.

For more on debt collection from the Federal Trade Commission see:  Debt Collection  FAQs

Montgomery County Office of Consumer Protection
100 Maryland Ave., Ste. 330
Rockville, MD 20850
T: 240.777.3636
If you need help with a debt collection issue, contact OCP by calling 240.777.3636 to speak with the Investigator-on-Duty or file a  complaint with our office.

Federal Trade Commission
600 Pennsylvania Ave., NW
Washington, DC 20580
T: 1.877.382.4357
The Federal Trade Commission (FTC) offers information on:
  • Debt Collection
  • Filing Complaints (Please note that the  FTC does not investigate individual complaints.)​

The Commissioner of Financial Regulation
1500 North Calvert Street, Suite 402
Baltimore, MD 21202
T: 410.230.6100 or Toll Free: 1.888.784.0136
Contact the Commissioner of Financial Regulation to file a complaint or verify a debt collector's licensing status.

Consumer Financial Protection Bureau
1700 G Street , NW
Washington, DC 205 52
T: 1. 855 . 411 . 2372

C ontact the Consumer Financial Protection Bureau ( CFPB ) if you have a problem with a financial product or service to get answers to frequently asked questions or file a complaint. 

Are you having problems with a debt collector? The National Association of Consumer Advocates has prepared a few short videos that may help.