Know Your Rights — A Plain-English FAQ on Consumer Debt

Can a debt collector call me at work?

Only until you tell them not to. Once you tell a debt collector — by phone, in writing, or both — that you cannot accept calls at work, they cannot contact you there. Your employer's policies on personal calls also matter, but the FDCPA gives you the right to stop work calls regardless.

Can they call me before 8 AM or after 9 PM?

No. The FDCPA prohibits calls before 8 AM or after 9 PM in YOUR time zone, unless you've specifically agreed otherwise. If you're in California and they call from New York at 7 AM your time, that's a violation.

How often can a collector call me?

CFPB Regulation F (effective late 2021) creates a presumption that a collector who contacts a consumer more than 7 times in any 7-day period — or contacts the consumer within 7 days of having a phone conversation about the debt — is harassing the consumer. The presumption can be rebutted, but the rule sets a clear practical limit.

Can a collector tell my family or neighbors that I owe money?

No. The FDCPA prohibits collectors from communicating with third parties about your debt, with very limited exceptions (your spouse, your attorney, certain location-information calls that don't reveal the debt itself). Telling your sister, your boss, or your neighbor that you owe money is illegal.

Can they threaten to arrest me?

No. Failure to pay a consumer debt is not a crime in the United States. A collector who threatens you with arrest, jail, or criminal prosecution is committing an FDCPA violation. This is one of the most common violations the CFPB has cited.

Can they use threatening or abusive language?

No. The FDCPA prohibits the use of profane, threatening, abusive, or harassing language. Yelling, name-calling, racial slurs, and threats of physical harm are all violations.

What if I send a written cease-and-desist?

A written notice telling the collector to stop contacting you must, by federal law, end most communication. After receiving a written cease-and-desist, a collector can only contact you to (a) confirm they will stop, (b) notify you that specific actions (like a lawsuit) may be taken, or (c) notify you that they are actually taking those actions. Routine collection contact must stop.

Send the cease-and-desist by certified mail with return receipt. Keep your copy. Note the date.

What can I do if a collector violates these rules?

You may have a claim under the FDCPA worth up to $1,000 in statutory damages per case, plus actual damages, plus attorney fees. Document every violation — date, time, what was said. The National Association of Consumer Advocates (NACA.net) maintains a directory of consumer protection attorneys, many of whom take FDCPA cases on contingency.

You can also report violations to the Consumer Financial Protection Bureau (consumerfinance.gov) and your state attorney general.

What is a debt validation letter?

Under FDCPA Section 809 (15 U.S.C. Section 1692g), the first time a debt collector contacts you about a debt, they must — within five days — send you a written notice that includes the amount of the debt, the name of the creditor, and a statement of your right to demand validation within 30 days.

If you send a written request for validation within those 30 days, the collector must stop collection efforts until they provide written verification of the debt. This is one of the most important rights consumers have.

How do I write a validation letter?

The letter doesn't need to be complicated. State that you are requesting validation under the Fair Debt Collection Practices Act. Identify the debt (account number, original creditor name, amount). Request the documentation that proves you owe the debt in the amount claimed and that the collector has the right to collect it. Send by certified mail with return receipt. Keep your copy.

Many state attorney general websites and the CFPB website provide free template validation letters consumers can adapt.

What does the collector have to actually produce?

The FDCPA requires "verification" of the debt. What that means in practice has been worked out through court cases over the decades. At minimum, the collector should provide documentation showing: (a) the debt is owed, (b) the amount is correct, (c) the collector has the authority to collect.

For credit card debt, this usually means the original signed agreement, a statement showing the balance, and the chain of ownership if the debt has been sold. The CFPB's enforcement actions against major debt buyers cited specifically that collectors had often pursued debts without sufficient documentation to validate them.

What if they can't validate the debt?

If a collector cannot provide sufficient validation, they cannot legally continue collection efforts on the unverified debt. They may sell the account to another buyer who tries again. They may stop entirely. Document the exchange — your validation request, their response (or lack of response), the date.

If the collector continues collection without validating, that may itself be an FDCPA violation. A consumer protection attorney can advise on whether you have a claim.

How long can a collector legally sue me on an old debt?

Each state sets a statute of limitations on consumer debt collection lawsuits. The clock typically starts on the last activity on the account — often the last payment. Once the statute expires, the debt cannot be successfully sued on, though the collector can still attempt non-litigation collection.

Typical state ranges:

• Most states: 3-6 years on credit card debt
• Shorter end: California (4 years on written contracts), Texas (4 years), Pennsylvania (4 years)
• Longer end: Florida (5 years), Arizona (6 years on written contracts), some states longer for written contracts
• Recently changed: New York is now 3 years on consumer credit transactions (CPLR 214-i, effective April 2022 — down from the prior 6-year period)
• Outliers: Rhode Island (10 years), Kentucky (10 years for written contracts; KRS 413.160 was shortened in 2014)

These figures reflect the most common credit-card / written-contract limit; periods can vary by debt type and recent state legislative changes. Consult a state-specific source before relying on any specific number.

Does a partial payment restart the statute clock?

In many states, yes. Making a payment — even a small one — on an old debt can restart the statute of limitations clock. Some states require the payment to be accompanied by a written acknowledgment to restart the clock; some don't.

This is why senior debt specialists and consumer protection attorneys advise consumers NOT to pay anything on an old debt without first understanding their state's rules. A small "good faith" payment that resets the clock is one of the worst common mistakes consumers make on time-barred debt.

How do I find my state's statute of limitations?

Your state attorney general's consumer protection division typically publishes guidance. The CFPB also provides general information at consumerfinance.gov. For specific situations — especially when you're considering paying an old debt or being sued on one — a state-specific consumer protection attorney can confirm your state's current rule.

What do I do if a collector contacts me about an old debt?

First, do not acknowledge or pay anything. Get the collector to identify themselves, the original creditor, the date of last activity, and the current balance — in writing. Then check your state's statute of limitations. If the debt is past the statute, the collector cannot successfully sue you. Per CFPB findings, suing on a time-barred debt is itself a violation of consumer protection law.

You can send a written notice declining to pay and requesting they stop contacting you. The debt may continue to appear on credit reports for the federal seven-year window from the date of original delinquency.

Can I be sued for credit card debt?

Yes. If you stop paying a credit card debt and the original creditor or a debt buyer believes the amount and timing make it worthwhile, they can file a civil lawsuit. The lawsuit is filed in your local civil court (sometimes magistrate court, sometimes district court depending on the amount).

Whether you'll actually be sued depends on the balance, the age of the debt, your state's statute of limitations, and the creditor's collection strategy. Many smaller balances are not litigated because the cost of suit exceeds expected recovery.

What happens if I ignore a debt collection lawsuit?

The court can enter a default judgment against you for the full amount claimed. With a judgment, the creditor can pursue wage garnishment, bank account levies, and (in some states) liens on real property. Default judgments are one of the most common ways consumers end up with wage garnishment.

If you receive papers indicating a lawsuit has been filed, do NOT ignore them. You typically have 20-30 days to file an answer with the court. Even an unpaid debt benefits from contesting the lawsuit if the documentation is weak. A consumer protection attorney can advise — and many take cases on contingency.

How much of my paycheck can a creditor garnish?

Federal law (Title III of the Consumer Credit Protection Act) generally limits wage garnishment to the LESSER of 25% of disposable earnings OR the amount by which weekly disposable earnings exceed 30 times the federal minimum wage. State laws may provide stronger protection. Texas, Pennsylvania, North Carolina, and South Carolina generally do not allow wage garnishment for consumer debts.

Read more in our full wage garnishment article.

Can my Social Security be garnished?

Generally no — Social Security retirement and disability benefits are protected from garnishment by private creditors under Section 207 of the Social Security Act. Exceptions exist for certain federal debts (some federal student loans, IRS debts, federal court judgments) but not for credit card debt.

If your bank account contains both Social Security deposits and other funds, you may need to file an exemption claim with the court within a short window after a bank levy to keep the protected funds. The federal "anti-attachment" rule generally protects two months' worth of Social Security automatically — but mixed accounts can complicate the protection. If Social Security is your primary income, consider keeping it in a separate account.

How long does an unpaid credit card debt stay on my credit report?

Under the Fair Credit Reporting Act, most negative information stays on your credit report for seven years from the date of original delinquency. The seven-year clock does NOT restart when an account is sold to a debt buyer, and it does NOT restart from the most recent collection attempt. It starts from the original delinquency.

Bankruptcy is the exception: Chapter 7 stays for 10 years from filing; Chapter 13 stays for 7 years.

What is a 1099-C? Will I get one if my debt is forgiven?

A Form 1099-C ("Cancellation of Debt") is an IRS form that creditors are required to file when they forgive $600 or more of debt. The IRS treats forgiven debt as potentially taxable income — meaning you may owe income tax on the amount forgiven.

If a creditor forgives $5,000 of your debt, they may issue a 1099-C to you and to the IRS for $5,000. Without action, that $5,000 could be reported as income on your tax return for the year.

Do I actually have to pay taxes on forgiven debt?

Often no, because of the "insolvency exclusion" under Internal Revenue Code Section 108. If your total debts exceeded your total assets at the time of the forgiveness, the forgiven amount up to the amount of your insolvency is generally NOT taxable.

Example: If you had $80,000 in total debts and $30,000 in total assets at the time of forgiveness, you were "insolvent" by $50,000. Up to $50,000 of forgiven debt can be excluded from income under IRC Section 108.

Most families considering debt forgiveness are insolvent under this definition by a wide margin — that's part of why they're considering forgiveness in the first place. The protection covers most situations.

How do I claim the insolvency exclusion?

You file IRS Form 982 ("Reduction of Tax Attributes Due to Discharge of Indebtedness") with your tax return for the year you received the 1099-C. The form requires you to calculate your insolvency at the time of the discharge — total liabilities minus total assets, immediately before the discharge.

The exclusion is not automatic. The IRS won't apply it unless you file the form. A tax preparer who has handled this situation before files it cleanly. A senior debt specialist can refer you to one if needed.

What's a charge-off and what does it mean for my credit?

A charge-off is the original creditor declaring an account a loss for accounting purposes — typically at about 180 days delinquent. It does NOT mean the debt is forgiven. The obligation still exists; the original creditor has just written it off their books and either continued collection or sold it to a debt buyer.

A charge-off appears on your credit report as a serious negative mark. The seven-year reporting clock runs from the original delinquency, not from the charge-off date.

Does paying a charged-off debt help my credit score?

Less than you'd expect. Newer credit scoring models (FICO 9, VantageScore 3.0+) treat paid collections more favorably than unpaid ones, but the original delinquency stays on the report. Older scoring models (still used by some lenders) may treat paid and unpaid collections similarly.

Sometimes a "pay for delete" arrangement — where a collector agrees in writing to remove the collection notation in exchange for payment — is possible. This is not guaranteed under the FDCPA but can be negotiated. Get any such arrangement in writing before paying.

Can I go to jail for not paying credit card debt?

No. The United States does not have debtors' prison. Failure to pay a consumer debt is not a crime.

The exception is contempt of court — if a court orders you to do something (appear at a hearing, comply with a court order) and you fail to do it, the court can hold you in contempt. That's about disobeying the court, not about owing debt. A collector who threatens you with jail for unpaid debt is committing an FDCPA violation.

Am I responsible for my spouse's debt?

It depends on who signed for the debt and what state you live in. Generally, you are not personally liable for debts that are solely in your spouse's name. Joint accounts (where both names are on the account) make both spouses liable.

Community property states (California, Texas, Arizona, New Mexico, Nevada, Idaho, Louisiana, Wisconsin, Washington) treat debts incurred during the marriage differently — both spouses may be liable for marital debts even if only one name is on the account.

For specific situations, a state-specific consumer protection attorney can advise.

Will my employer find out about my debt situation?

Not from a debt collector — collectors are prohibited from telling your employer about your debt under the FDCPA. The exception is when wage garnishment is in process: the employer receives the court order and must comply. The garnishment order itself is not allowed to be used as grounds for firing you (under federal Title III protection for the first garnishment).

For positions that require background checks (financial industry, security clearance, some others), background investigators may pull credit reports and see negative items. The reporting timeframes (seven years for most debt) apply.