Your Rights Under Ontario Debt Collection Laws

Life’s unpredictability sometimes leads us down the road of financial difficulties. From job loss, medical emergencies to unexpected expenses, we can find ourselves unable to meet our financial obligations. When these obligations become overdue, debt collectors may come calling. It’s essential to understand Your Rights Under Ontario Debt Collection Laws in such situations.

What Triggers Debt Collection Calls

If you’ve been receiving calls from debt collectors, it’s usually because your creditor has assigned your debt to a collection agency. This agency is tasked to recover the debt on your creditor’s behalf and typically earns a commission based on the amount they manage to collect.

Alternatively, your creditor might have sold your overdue debts to a debt buyer or collection agency. In this scenario, the debt collector is calling you on their behalf because they now have ownership of your debt.

Types of Debts that Can Be Recovered

A collection agency can be assigned any kind of debt. This includes amounts owed on credit cards, overdue utility bills, bank or car loans, lines of credit, and even judgments under a lawsuit.

Your Rights When Dealing with Collection Calls

In Ontario, individuals are protected by the Ontario Collection and Debt Settlement Services Act (the “Act”). The Act dictates strict laws on what a debt collection agency can and cannot do, aiming to prevent agencies from using harassing or intimidating tactics.

However, it’s crucial to understand that the Act only applies to third-party agencies. If the calls are from your original creditor or a collection agency that bought the old debt from your original creditor, the Act does not apply.

Understand Your Rights Under Ontario Debt Collection Laws

Here are ten rights all residents of Ontario should be aware of when dealing with collection agencies:

#1. Right to receive written notice before calls commence

A collection agency should not call you unless they have sent you a written notice first and 6 days have passed since the notice was sent.

The notice should include details like:


  • The name of the business or person you owe money to.
  • The original amount you owe.
  • The current amount you owe, if different.
  • The type of credit (credit card debt, utility bill, car loan, etc.).
  • The collection agency’s name and contact information.
  • Confirmation that the agency is registered in Ontario.
  • A statement that the agency will provide a breakdown of the current amount owing, if requested.
  • A consumer disclosure statement outlining your rights and the steps you can take if you believe the agency has broken the law.

#2. Right to not be threatened with legal action

Debt collectors can sue you, but they rarely do so due to the high costs of litigation. They are breaking the law if they send you a “Draft Statement of Claim” that appears to be issued by a court.

#3. Right to not be called at inconvenient times

Unless you agree otherwise, debt collectors must not call you prior to 7 am or after 9 pm from Monday to Saturday, prior to 1 pm or after 5 pm on Sunday, and on statutory holidays.

#4. Right to limit the number of contacts

Debt collectors can only contact you three times in a 7-day period, unless you agree otherwise. Contact means talking to you on the phone, leaving a voicemail, or sending an email.

#5. Right to not be threatened or abused

Debt collectors cannot threaten you or use profane or obscene language.

#6. Right to not incur costs due to contact methods

Debt collectors must not contact you using a method that incurs costs to you. If they are aware that their contact method incurs charges for you, they must cease using that method.

#7. Right to privacy

Debt collectors cannot discuss your debt with third parties except in specific scenarios where they have your written permission, the third party has guaranteed payment of your debt, they are confirming your employment status, or they are inquiring about the status of a court-ordered wage garnishment.

#8. Right to not owe more than the current amount

Debt collectors cannot charge extra fees or expenses other than the actual debt you owe, with the only exception being Provincial Offences fines owing to municipalities.

#9. Right to receive a breakdown of the current amount owed

If you request a breakdown of the current amount you owe, a collection agency must provide it.

#10. Right to not be sued if 2 years have passed since your last payment

If 2 years have passed since your last payment, you can’t be sued on the debt. However, if you acknowledge the debt when talking to the debt collector, the 2-year period starts over.

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