July 2, 2020

Know Your Rights: Dealing with Debt Collectors

If you are behind on your debt payments, you may have come into contact with debt collectors. These are independent individuals or organisations that are hired by creditors to follow up with debtors who have overdue repayments. You may be worried that a debt collector will show up and bully you with physical violence or threaten to call your employer and tell them about your debt. However, these acts of intimidation, along with many others, are outlawed in the official Code of Conduct as laid out in the Debt Collectors Act of 1998.

Here is a quick breakdown of what debt collectors are and are not allowed to do according to South African law:

Debt Collectors May NOT:

  • Imitate legal or judicial forms of communication (e.g. court summons) in order to make contact with you
  • Lie about why they have come to see you
  • Share any untrue or misleading information that may be harmful to you and/or your family
  • Collect more money than what is owed to the creditor (with the exception of interest and other costs that are legally recoverable). If a debt collector is asking for more money than you think is right, ask them to break down the costs and explain exactly how they calculated the amount that they are attempting to collect from you.
  • Threaten you, your family, or your property with violence (orally or in writing)
  • Use threatening or defamatory language when talking with you or your family
  • Share, or threaten to share, any information that may threaten the employment or employment opportunities of you and/or your family
  • Demand payment without explicitly stating the name of the creditor, the balance owed, and the identity and basis of the claim of the person making the demand
  • Use any method or procedure designed to embarrass you or your family
  • Allow personal feelings to influence their dealings with you
  • Threaten legal action when they have no intention of carrying out this threat
  • Contact you when your lawyer has instructed them (in writing) to only correspond with your legal counsel
  • Contact you on a Sunday, or between 9 pm and 6 am, unless you have explicitly asked them to do so
  • Contact, or threaten to contact, your employer to pressure you into paying debt (note that a debt collector may contact your employer in order to verify your employment status or income)
  • Contact or communicate with your employer, friends, family, acquaintances or neighbours, unless they stand surety for you or the debt collector is seeking to determine your address or phone number
  • Share or threaten to share information about a debt that you dispute, unless they also communicate the fact that you dispute said debt
  • Come to your residence in a car that is decorated in a way that clearly indicates that you are being visited by debt collectors
  • Tell or threaten to tell someone besides you and your spouse about your debt, except through proper legal proceedings

Most debt collectors and debt collection agencies are very professional and reasonable, so you shouldn’t have too many problems in your dealings with them. However, things can turn ugly, and it’s essential that you know and understand your legal rights.

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