Debtors’ Rights

What Are My Rights as a Debtor?

Debt collectors have a nasty reputation for treating debtors poorly.

Whether it’s threatening them with repossession or humiliating you, debt collectors can be surprisingly ruthless with their methods.

But this raises a question; is any of these legal?

Can they actually do the things they claim and is there a point where a debt collector can go too far?

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There absolutely are limitations to what a debt collector can do.

Some debt collectors will do or say anything to force you into paying.

It can be stressful, frustrating and even frightening considering some of the lengths that these collection agencies go to in order to collect your payments.

It’s important to understand your rights as a debtor in Canada so that you can keep a level head and prevent debt collectors from abusing your lack of knowledge.

So in this article, we’re going to talk about your rights as a debtor.

The Debt Collection Act

The Debt Collection Act was put in place to protect debtors from the use of undue force from debt collectors.

It states that a collector must not put any unreasonable amount of pressure on a debtor, a member of their family or even their colleagues and employer.

This applies to the collection, negotiation and demand of debt payment, repossession and also eviction.

Undue force is defined as the following:


  • Making a threat or charge that doesn’t pertain to the collection of debt. This means they cannot threaten you in any way regardless of the situation.


  • Outside of simply verifying that you are employed, a debt collector cannot communicate with your employer without first seeking your consent.


  • Communicating with you, your family, or your employer without your consent and in an aggressive manner that causes distress.


  • Calling a debtor while they are at work if the debtor has explicitly written to the collector stating not to.


  • Sending forms or letters to the debtor that look like official court documents.


  • Continuously sending documents and letters or calling a debtor after the Director has advised the collection agency to stop.


  • Attempting to collect on a debt that someone is not liable for. If you have not signed for the debt, you are not obligated to pay it until you have spoken to a professional. Debts do not transfer through marriage, meaning you are not responsible for your partner’s debts unless you have explicitly signed for it.


  • Collecting a debt that is not owed or attempting to extort more money from the debtor than is owed.


  • Attempting to collect a debt without a license from the Government unless they are employed by the company that granted the credit.


  • Attempting to charge an additional fee for collection if they are not payable by the debtor.


  • Communicating with a person during times and dates that are prohibited by the legislation of the province. This varies depending on the province, so it’s important to check your local laws.


Debt Collectors

These definitions of undue force are enforced on anyone that works in the field of debt collection and is not limited to debt collectors as a profession.

Finally, debt collectors are all accountable and bound by this legislation.

If they attempt to lie by saying they are not governed or bound by the Debt Collection Act, you should ignore them.

It’s worth noting that there are plenty of fair and understanding debt collectors in the industry.

There’s a good chance that you will be contacted by someone that takes a modest approach to collection and abides by all of the rules.

However, like with many other industries, there are a few aggressive debt collectors that give everyone else in the field a bad name.

Regardless, it’s a good idea to understand your rights as a debtor so that you don’t feel pressured when they are breaking the legislation that they are bound to.

Of course, you must refrain from abusing these rules.

While it can be stressful to deal with debt collectors even if they are following the rules, it’s important that you listen to and understand them in order to deal with your debts swiftly and effectively.

If you’re having money problems and can’t afford to pay the collector or would like to reach a different conclusion, highly suggest that you speak to a debt relief service for more information on how to proceed.

Canadian Bankruptcies

How to File for Bankruptcy
What is Bankruptcy?
Bankruptcy FAQs
How Does Bankruptcy Work?
What is the Cost of Bankruptcy in Canada?
How to Rebuild Credit Following Bankruptcy
Personal Bankruptcy in Canada
What Debts are Erased in Bankruptcy?

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