Dealing with Debt Collectors

If you're behind on debt payments, there are laws to protect you from harassment by collectors. For example, collectors can’t use threatening language or contact you during certain times of day.

Understand your legal rights

The difference between a collector and a collection agent (and why this matters)

Under the law in BC, a collector is a person who is collecting or attempting to collect a debt. BC debt collection laws apply to any person or business that fits this description. It could be a retail business you bought furniture from, a cellphone company you signed a contract with, or a collection agency that has taken over your overdue credit card debt.

A collection agent, meanwhile, is someone who in the course of business collects debt for other parties. A party who is owed money (a creditor) might decide to “sell” the debt to a collection agent. In exchange, the collection agent typically promises to give the creditor a portion of the debt the agent is able to recover.

Why this matters

Collection agents have no special legal powers to collect from a debtor. They are like any other creditor. That said, collection agents are known for their aggressive tactics. (Agents make money only if they recover some of the debt, which can lead to more aggressive tactics.) Some collection agents contact debtors often and use intimidation to scare debtors into paying. Many of the laws we explain here are designed to protect debtors from these types of tactics.

Collection agents must be licensed

As well, collection agents must be licensed by Consumer Protection BC. If a collection agent is treating you badly, Consumer Protection BC has more scope to penalize them.

A collector can’t harass you

Under the law in BC, a collector (including a collection agent) can’t communicate with a debtor in a way that amounts to harassment. Examples of harassment include:

• using threatening, profane or intimidating language
• exerting excessive or unreasonable pressure
• publishing or threatening to publish a debtor’s failure to pay

For example, a collector can’t phone your home every hour demanding payment. This would be exerting excessive or unreasonable pressure.

This rule also covers a member of the debtor’s family or household, a relative, neighbour, friend or acquaintance, or the debtor’s employer.

As well, under Canada’s criminal laws, a collector mustn’t:

• threaten to harm a debtor or their property
• abuse its authority to get money from a debtor
• convey false information with the intent to alarm a debtor

A collector can’t be deceptive. For example, they can’t send you letters that look like they come from the government when they don’t. That’s considered false information designed to scare you.

How a collector can contact you=

The collector must first send you written notice

Under the law in BC, a collector can’t try to collect payment of a debt until they’ve sent the debtor written notice. This notice must include:

• The name of the creditor (both the original creditor and the current one if it’s different).
• The amount of the debt (both on the date it was first due and the amount currently owing).
• The collector’s identity, and its authority for collecting the debt.

However, a collector can call a debtor before sending the notice if the collector is only trying to find out the debtor’s home address or email.

What time of day a collector can contact you

Under BC law, a collector must not communicate by telephone or in person with a debtor:

• from Monday to Saturday before 7 am or after 9 pm
• on a Sunday before 1 pm or after 5pm
• on a statutory holiday at any time

This rule also applies to:

• a member of a debtor’s family or household
• a relative, neighbour, friend or acquaintance of the debtor
• the debtor’s employer
• any guarantor of the debt

When a collector can contact you at work

Under BC law, a collector can only contact a debtor at work in one of the following situations:

• The collector doesn’t have the debtor’s home address, phone number or email, and is only trying to get that information.
• The debtor permits the collector to contact them at work.
• The collector has attempted to contact the debtor at home, by phone or by email, but has failed to connect. In this case, the collector must not make more than one verbal attempt to contact the debtor at work.

You can request a collector contact you only in writing

Under BC law, a debtor can request that a collector communicate with them only in writing. (The debtor must provide their mailing address.)

Alternatively, you can request that a collector communicate directly with your lawyer.

Consumer Protection BC provides forms you can fill out and give to a collector to request communication in writing or through a lawyer.

You can dispute the debt

Under the law in BC, you can dispute a debt, inviting the creditor to take the matter to court. You might dispute a debt where:

• the debt was already paid
• it’s someone else’s debt
• the collector is asking for more than what’s owed

Once you notify the collector and the creditor that you dispute the debt, a collector must stop communicating with you.

To dispute a debt, you must contact the collector and the creditor in writing. Consumer Protection BC offers a form you can use to dispute a debt.

Common questions

Can a collector contact my family and friends?

Only in very limited circumstances. Under the law in BC, a collector can contact a debtor’s friends or family members only to request the debtor’s home address, phone number or email. Two exceptions to this rule are when:

1. The person being contacted has guaranteed the debt, and is being contacted about the guarantee.
2. The debtor has given permission to the collector to contact the person about the debt.

It’s illegal for a collector to harass a debtor’s friends or family members. See above for a description of what amounts to harassment.

Can a collector contact my boss?

Only in two circumstances:

1. For the purpose of confirming your employment, work title and work address. In this case, the collector must first give you notice they intend to bring legal action to recover the debt.
2. If you authorize (in writing) the collector to contact your employer.

Otherwise, a collector must not communicate with your employer.

As well, it’s illegal for a collector to harass a debtor’s employer. For example, a collector can’t repeatedly call your boss to try to get you fired over an unpaid debt.

My child owes money, and the collector is coming to me for payment. Can they do that?

No. A collector cannot try to collect a debt from someone who doesn’t owe the money. Consumer Protection BC offers a form to advise a collector you are not the debtor.

If you are responsible for the debt, things are different. For example, if you guaranteed or co-signed a loan, a collector can come to you for payment. In such a case, the collector would still need to follow the rules explained here.

Get help

With an unreasonable collector

Consumer Protection BC licenses collection agents in the province and oversees debt collection practices. They can help if you have a complaint about debt collection.

Toll-free: 1-888-564-9963

Web: consumerprotectionbc.ca

Tip People’s Law School’s information on dealing with debt collectors includes step-by-step guidance on making a complaint about a collector.

With managing your finances

The Credit Counselling Society of BC is a non-profit society that helps people better manage their money and debt.

Toll-free: 1-888-527-8999

Web: nomoredebts.org

[updated July 2018]

The above was last reviewed for legal accuracy by Bruce Hallsor QC, Crease Harman.

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