Rights of Consumers

Consumers facing debt and collection activity have important legal rights. Creditors and debt collectors may pursue legitimate debts, but they must follow applicable federal and state laws when communicating with consumers and attempting to collect money.

Understanding your rights can help you recognize potentially improper collection practices, respond to collection efforts, and make informed decisions about debt relief or bankruptcy.

Your Rights When Dealing With Debt Collectors

Federal consumer protection laws, including the Fair Debt Collection Practices Act (FDCPA), regulate certain activities by covered debt collectors. Illinois law and other federal laws may provide additional protections depending on the circumstances.

Consumers may have protections against certain abusive, unfair, or deceptive collection practices.

Potential concerns can include:

  • Harassing or abusive communications
  • Repeated or excessive collection calls
  • False or misleading statements about a debt
  • Threats of actions that cannot legally be taken
  • Improper disclosure of debt information to third parties
  • Attempts to collect amounts that are not actually owed
  • Misrepresentation of a collector’s identity or authority
  • Collection activity that otherwise violates applicable law

Not every unwanted collection call or demand is unlawful. Whether a collector’s conduct violates the law depends on the specific circumstances.

Your Right to Dispute a Debt

If you believe a debt does not belong to you or the amount is incorrect, you may have rights to dispute the debt and request information regarding the obligation.

Keep copies of collection letters, account statements, emails, and other communications related to the debt. Maintaining accurate records may be helpful if a dispute develops.

Your Rights if You Are Sued for a Debt

A collection lawsuit should not be ignored. Consumers generally have the right to respond to a lawsuit and raise applicable defenses.

Depending on the circumstances, issues may include whether:

  • The debt actually belongs to you
  • The amount claimed is accurate
  • The creditor can establish its right to collect
  • The lawsuit was filed within applicable legal deadlines
  • Proper collection and court procedures were followed

Court deadlines can be important, so responding promptly may help preserve available rights.

Protection From Wage Garnishment and Property Collection

If a creditor obtains a judgment, certain collection methods may become available. These can potentially include wage garnishment, bank account levies, or other judgment enforcement actions.

Federal and Illinois laws may protect certain income and property from collection or limit how much can be taken.

The protections available depend on the type of income, property, debt, and collection action involved.

Your Rights When Filing Bankruptcy

Bankruptcy provides additional protections for qualifying individuals facing overwhelming debt.

When Chapter 7 or Chapter 13 bankruptcy is filed, an automatic stay generally takes effect. This can stop many qualifying creditor collection activities while the bankruptcy case is pending.

Depending on the circumstances, the automatic stay may affect:

  • Collection calls and letters
  • Creditor lawsuits
  • Wage garnishments
  • Bank account levies
  • Certain foreclosure proceedings
  • Other qualifying collection actions

There are exceptions, and the automatic stay does not apply to every debt or legal proceeding.

Protection After a Bankruptcy Discharge

When qualifying debts are discharged through bankruptcy, creditors generally cannot continue attempting to collect those discharged obligations from the individual.

A bankruptcy discharge does not eliminate every type of debt. Certain taxes, domestic support obligations, many student loans, and other debts may remain depending on the circumstances.

Understand Your Consumer Rights

If you are dealing with aggressive debt collection, a collection lawsuit, wage garnishment, bank levy, or overwhelming financial obligations, understanding your rights can help you decide what action to take.

Consider speaking with a Chicago consumer debt attorney or bankruptcy attorney to learn about consumer protections, debt defense, Chapter 7, Chapter 13, and other options that may apply to your financial situation.