By Jeffrey Schwartz
If you owe money in Ontario, it’s important to know your rights as a consumer. If you’re unable to repay debt that you owe for whatever reason, a company may send the outstanding debt to a collection agency. The collection agency may threaten you with court or legal action, but there are limitations to what they can say and do. For instance, a collection agency cannot say false or misleading information.
In this article we’ll look at your rights regarding collection agencies, how long a collection agency can collect debt in Ontario, and how to stop collection agency calls.
Your Rights Regarding Collection Agencies
Regardless of whether you owe the money to an Ontario collection agency, you have rights as a consumer. The collection agency cannot harass you. It must follow a strict set of rules set out in the Collection and Debt Settlement Services Act. If you feel that a collection agency has broken the rules, you have every right to file a complaint with the Ministry of Government and Consumer Services.
If a collection agency would like to contact you in Ontario, representatives must send you a private letter by mail or email.
The collections agencies act states that the letter must contain the following information:
- How much you owe and the type of credit (i.e. credit card, line of credit, student loan, etc.)
- The business or person(s) to whom you owe money
- The collection agency that you owe money to, along with its contact information (i.e. mailing address, phone number, fax number and email)
- A disclosure statement outlining your rights and the steps you can take if you think the collection agency has overstepped its bounds
- Confirmation that the collection agency is registered in Ontario
- They must provide a breakdown of the debt you owe upon your request
The collection agency is required to wait six days after they send you the letter before they can make another attempt to collect the debt. Just to clarify, contacting you means the agent has actually spoken with you on the phone. Other ways the collection agency can contact you is by email or voicemail.
However, if you don’t respond to the phone call and the collection agent doesn’t leave a voicemail, that’s not considered contact and the collection agent can attempt to contact you again. Likewise, if the collection agency sends you a letter by regular mail, it’s not considered contact either.
After a collection agency sends you a letter, there are restrictions on who they can contact and when. They can only contact you Monday to Saturday between 7am and 9pm, and on Sunday between 1pm and 5pm.
Furthermore, the collection agency can only contact your friends, spouse, family or neighbours if:
- They have guaranteed your debts
- The collection agency is attempting to confirm your contact information, or
- You’ve provided permission in writing to contact them
How long can a collection agency collect on a debt in Ontario?
There is a limit for how long a collection agency can attempt to collect debt in Ontario. There is a statute of limitations for debt collection of two years in Ontario.
Despite this, if you owe money in Ontario and you don’t pay, debt collectors are still allowed to pursue you for money owing to them. Also, if you admit that you owe this money or you make a payment on the principal or interest, the two-year limit clock resets.
Stop Collection Agency Calls
Stopping collection agency calls depends on whether you owe money.
To stop a debt collection agency from calling you if you owe money, you’ll need to either pay off the debt that you owe or contact the collection agency to negotiate a settlement.
If you’re finding it tough to pay off your debts, you might consider reaching out to a credit counselling service for help.
If you’re experiencing a case of mistaken identity and you don’t owe any money, it’s a good idea to find the collection agency’s telephone number and mailing address. Contact the debt collector to let them know you’re not the person they’re looking for.
The collection agency is required to make sure you’re the right person they seek. If you advise the collection agency that you’re not the right person and they keep calling, you might look into filing a complaint.
When a collection agency contacts you, it may feel like you don’t have any rights, but that’s simply not true. As mentioned above, every consumer has rights all collection agencies must respect and abide by, even if you owe money. A collection agency isn’t allowed to harass your family or you on the phone until you pay it.
About Jeffrey Schwartz
Jeffrey Schwartz is the Executive Director of Consolidated Credit Counseling Services of Canada and President of the Credit Association of Greater Toronto (CAGT). Consolidated Credit is a national non-profit credit counselling organization that teaches consumers about personal finance through web-based budget and debt analysis tools, financial literacy community outreach programs and in-person or telephone counselling. CAGT is a non-profit association with a mission to provide a dynamic forum in which members can share information and expertise.