Wednesday, 1 March 2017

Legal Guidelines for Debt Collectors

The ACCC has set Debt Collection guidelines for organisations involved in the provision of Debt Collection services and Debt Recovery activities. Organisations involved in providing these Debt Collection services need to be aware of their obligations and ensure they adhere to these guidelines.

Contact with the debtor by the Debt Collection agency should always be for a reasonable purpose, at a time a place within the guidelines. The debtor has the right to be treated fairly, courteously and with respect. Any demand for payment or Debt Collection letter sent should firstly provide the details of the debt, detail the amount demanded and provide the debtor with details of whom they need to contact to make payment in full or discuss an arrangement for repayment of the debt.

The demand and follow up for payment should in no way be threatening, misleading or harassing. It is illegal to use physical force or coercion to force the debtor into repayment of the debt. Nor can the action taken be harassing, misleading or deceitful in any way.

In assessing the debtors ability to pay their financial situation at the time needs to be considered along with any mental or physical issue that may be affecting their ability to pay. The Debt Collection agency by working through the debtors individual circumstances can assist the debtor in avoiding Bankruptcy. Bankruptcy is an option available to debtors who can’t pay their creditors but is something that can be avoided if reasonable payment arrangements are entered into with their creditors.

For more information about the legislation surrounding the debt collection industry in Australia, please don’t hesitate to call us or browse around our debt collection website to learn more.

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