Bankruptcy in Australia – What To Understand about Debt Collection

Many people face financial hardship at some point in their lives, and most of these folks are quite likely to be familiar with debt collectors. A debt collector is an individual whose job is to collect debts on behalf of a firm. A debt collector can either be an employee of an enterprise you owe money to, or they could be a third party working for a creditor. As you can picture, it’s not a simple job to squeeze money out of people who simply have none. It would be fair to say that many people in debt are already strained about their financial situation, and other people phoning them to remind them of this doesn’t always end smoothly. Consequently, debt collectors have a lot of adverse associations. There have been numerous cases of people being harassed by debt collectors so it’s important that individuals who are being contacted by debt collectors understand their rights and effective ways to manage these kinds of interactions.


Learn about Your Legal Rights.


Understanding what debt collectors can and can’t do is very important in having the capacity to effectively manage any interactions you may have with them. Under Australian Consumer Law, a debt collector must not:


Use any physical force or coercion (forcing you to do something).

Hassle or harass you to an unreasonable extent.

Mislead or deceive you (or attempting to do so).

Take advantage of people that are vulnerable, disabled, or have any other similar circumstances affecting them.


Not only do these laws apply to a debt collector’s behaviour towards you, but similarly your partner or spouse, family members, or anyone else related to you. If you end up in a position where a debt collecting is breaking these Laws, make a formal complaint to the Australian Competition and Consumer Commission (ACCC)1.


How And When Debt Collectors Can Contact You.


It’s likewise necessary to be aware of how and when debt collectors can contact you. They can do this by telephone, mail, emails, social networks or by visiting you in person. Any time you have correspondences with debt collectors, it’s integral that you keep a document of such interaction including the time and date of contact, the means of contact (phone, email, person), the debt collector’s name and company name, and what was said during the correspondence. It’s also important to note that debt collectors must respect your right to privacy and supplying your financial details to another party without your permission is breaking the Law.


The Australian Consumer Law also specifies that:


Debt collectors can only make up to 3 telephone calls or letters each week (or 10 each month).

Debt collectors can only phone you between 7:30 am and 9pm on weekdays and 9am to 9pm on weekends.

Debt collectors can only make face-to-face contact between 9am and 9pm on weekdays and weekends, once a month, and can only visit you if you haven’t answered any of their former attempts at communication.

There is to be no contact from debt collectors on national public holidays.

Debt collectors must be reasonably sure that if they contact you electronically (social media or email), that your account is not shared with another person and their communication can not be seen by anyone but you.


If you do agree to meet a debt collector in person, any threats of assault or violence should be reported to the police immediately1.


Know What Options You Have.


A debt collector’s job is not to be hospitable and give you a series of debt relief solutions. Their task is to encourage you to repay as much of your debt as possible, as fast as possible. So, the best thing to do is to recognise what your debt relief options are. You can perform some research on the web to see what options you have or you could seek professional debt management advice (most companies will offer free advice initially). Once you are aware of what options you have, you’ll be more self-confident in handling debt collector’s threats or demands, or any other collection tactics. If you don’t know what your options are, it makes the job of the debt collector much simpler by having the chance to control the discussion and informing you of what options you have, whether they’re true or not.


It’s always a tricky situation when you come into contact with debt collectors. Their job is very difficult, and they’ll use any methods possible for you to repay your debt since the amount of debt you repay and how quickly you repay it determines the commissions that debt collectors receive from lenders. The best way to manage correspondences with debt collectors is to recognise your legal rights, when and how they can contact you, record all communications, and knowing what debt relief choices you have. If you’re aware of these points, then it will substantially improve your interactions with debt collectors and hopefully won’t add extra stress to your current financial situation. If you need any advice about what debt relief opportunities you have, call the professionals at Bankruptcy Australia on 1300 795 575 or visit their website for more information: