How do debt collectors find you in Australia? A guide to the collection process

Here's what you need to know about debt collection in Australia, including how the process works and what to do if a debt collector contacts you.

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If you’re behind on repayments for a loan, credit card or utility bill, a debt collector may get in contact with you about it. While dealing with an overdue debt can be overwhelming, it’s usually easier to manage when you understand the process.

So if you’re worried about debt collectors contacting you, here's a look at your rights, how the process works and your options for dealing with outstanding debts.

Need help now? You can call the National Debt Helpline on 1800 007 007 to speak to a financial counsellor for free, or visit the website for online chat support and other resources.

When will a debt collector contact me?

Each provider has its own policy for overdue debts and debt collection and you'll usually hear from it directly if you miss a payment or a debt becomes overdue.

But if a lender has already contacted you about an overdue debt and you haven't responded or made payment towards it, it may refer the account to an independent debt collection agency.

Keep in mind that debt collectors are usually seen as a last resort for accounts that are overdue or "in default" – which can happen if you haven't made a payment for at least 60 days and owe $150 or more.

If you're struggling to pay a bill and are worried it may be given to a debt collector, contact the provider and let them know what's going on. It could offer you hardship support and/or a payment plan to help you clear the debt without involving third-party debt collectors at all.

How will debt collectors contact me?

The most common way for debt collectors to contact you is by phone, either on your given landline or mobile number. However, they can also contact you by letter, in person or online through email or social media.

How does a debt collector get my phone number or other contact details?

When a provider sells or passes your debt on to a collection agency, it gives the debt collector your account information. This usually includes contact details such as your phone number, email address and street or postal address.

A debt collector could also use the name on your account to search for you online.

When can a debt collector contact me?

The Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) have outlined a set of debt collection guidelines for creditors, debt collectors and people in debt. We’ve summarised these recommendations in the table below:

Type of contactTimesContact recommendations
PhoneMonday to Friday: 7:30am to 9pm

Weekends: 9am to 9pm

You could be contacted up to 3 times per week or 10 times per month in total
Other (letters, emails, social media etc)No specific hours listedYou could be contacted up to 3 times per week or 10 times per month in total
Workplace contact9am to 5pm on weekdays or your normal work hours (if known)You could be contacted up to 3 times per week or 10 times per month in total
In personWeekdays and weekends: 9am to 9pmDebt collectors should limit in-person contact to once per month and only when there is no other way to contact someone

Debt collectors are advised to respect any reasonable requests you have for contact within specific hours, based on your circumstances. If you think a debt collector is contacting you too often, or not giving you an opportunity to respond, contact the company to complain or make a consumer complaint with the ACCC.

Debt collectors and privacy

As well as recommendations around how often a debt collector can contact you, there are also regulations and requirements that help protect your right to privacy. For example, a debt collector is not allowed to give anyone else details about your financial situation or to reveal that they are a debt collector unless you give them permission to do so.

This means if a debt collector contacts you at home or work and you’re not there, they can’t tell anyone else about the situation. Similarly, if they contact you online, they have to be reasonably sure that no one else will see the information. If you think a debt collector has breached privacy laws, contact the Office of the Privacy Commissioner.

What can I do when debt collectors get involved?

If a debt collector contacts you, it’s ideal to respond to them as soon as possible so that you can deal with the overdue account. Depending on your circumstances, you may be able to consider some of the following options:

  • Keep a record of the contact. Take note of when a debt collector has contacted you and what they said. This will help protect your right to privacy and may be used as evidence if you have to lodge a complaint.
  • Explain your situation. Let the debt collector know why you haven’t made a payment. If you’re experiencing financial hardship, they may be able to offer you a payment plan without taking further action.
  • Work out how much you can afford to pay. Debt collectors may suggest a repayment plan for you based on the amount that you owe. When that’s the case, make sure you can afford the repayments based on your current circumstances. If you can’t, suggest a repayment amount that would be reasonable for you or ask about other options.
  • Request a hardship variation. This is a formal request for a variation in the terms of your loan or account. For example, you could request smaller repayments over a longer period of time, postponement of payments for a fixed amount of time or a combination of both these options. You’ll need to submit your request in writing and the credit provider must respond within 21 days.
  • Get professional advice. If you’re unsure of how to deal with your debt, contact the National Debt Helpline on 1800 007 007 to speak to a financial counsellor for free.

When will a debt collector stop contacting me?

Ignoring a debt collector won't make them go away, but some of the reasons they may stop or reduce contact with you include:

  • If you acknowledge that you owe the debt and agree to repay it (or enter into a repayment plan)
  • If the debt is not yours or is a case of fraud and you have sought legal action or a dispute
  • If the debt is more than 6 years old
  • If you are bankrupt and the debt is unsecured

For most debts in Australia, the debt collector or creditor can take legal action within 6 years from the date of your last payment, or from when you acknowledged in writing that you owed the debt (whichever is later).

But there are a few situations where they may have up to 15 years to collect the debt, including if a court judgement has been entered or if the debt is related to the mortgage of a property.

What if I am contacted about a debt that's not right?

If a debt collector has contacted you about a debt that you don’t think is yours, or if the amount of debt seems wrong, ask for a copy of your account information and contract. Check these details against your own and then contact the provider to dispute the debt.

If necessary, provide copies of any additional details, such as payments you’ve made that aren’t recorded on your account. If the situation still isn’t resolved, you can also get free legal advice through the Community Legal Centres Australia.

Dealing with overdue debts can be overwhelming, but there are many ways to get back on track. So now that you know how the process works, you can take steps to deal with your repayments in a way that works for you.

Pictures: Shutterstock

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