Don't Pay Debts You Don't Owe, FTC Warns

Some debt collectors are unrolling old and illegal tricks to collect unpaid debts from consumers - even if they don't owe a balance, according to the St. Louis Dispatch. The Federal Trade Commission recently settled a case with Allied Interstate Inc., a debt collector that was hounding consumers to pay debt that was in the wrong person's name or balances they didn't owe at all.

Other cases have emerged in which a debt collector demands payment for old accounts that were settled, or asks the consumer to pay a higher amount than what is really owed. But consumers should understand their rights under the Fair Debt Collection Practices Act to avoid paying debt they do not lawfully carry.

Consumers should always demand that the collector send their balance details in writing so they can confirm the debt is truly theirs and the balance is correct. If the balance is not theirs and they have informed the debt collector of this mistake, individuals should contact the FTC immediately and submit a formal complaint if the calls continue.

Individuals who do owe a balance should seek debt relief guidance through their lender or credit counselor to find the best way to resolve their unsettled balance. Lenders who see the borrower is making an effort to settle the debt will be more likely to help them find payment alternatives.