In the event that any borrower gets behind in their payments for a considerable period of time and has no apparent ability and/or desire to pay those bills, a creditor may assign them to a debt collection agent or agency. However, there are some such agencies that use intimidation, harassment, or unethical practices to elicit those payments, and the federal government, as well as many states, have enacted laws to protect consumers from such actions. The two primary federal laws are the Fair Debt Collection Practices Act and the Fair Credit Reporting Act. However, there are actions borrowers can take before their account falls into the hands of a debt collection agency, such as contacting an attorney to help negotiate or settle bills before their credit score is irreparably damaged.
New Mexico supports and enforces federal debt collection laws through the office of the Attorney General. Moreover, while there are no state statutes expanding on those laws, their protections are in force for the citizens of New Mexico, protecting them from those agencies that use unethical methods to collect debt payments on behalf of others.
In New Mexico, while there are no additional rules governing the actions of collection agents and agencies, there are laws requiring a license and bond for anyone collecting payments on behalf of others. The license and bond run concurrently for a period of approximately one year, and the bond is generally in the amount of $5,000.
Collection agents in New Mexico are authorized to contact borrowers and attempt to collect debts and payments on behalf of creditors, as well as to solicit and advertize for creditors to entrust them with such collections, barring any illegal processes for doing so.
Any kind of harassment, including debt harassment, is outlawed under federal and state laws in New Mexico.
Fraud is against the law in this country, through both federal and state laws. Moreover, while there are many companies offering to provide debt negotiation and debt settlement services today, too many of those companies are engaged in making fraudulent promises that they cannot or will not fulfill. Any borrower victimized by those who promise to reduce their debt amount and manage repayment plans at lower rates that do not perform those duties, but take their fees and disappear, the borrower has the right to report them to the Attorney General's office or law enforcement officials and contact a debt settlement lawyer to help recover their losses.
In addition, it is generally wise for borrowers to research the claims of such companies with the Better Business Bureau or consult an attorney to review any contracts before agreeing to allow these types of companies to represent them.
Those in financial trouble generally learn quickly that finding a way out can be complicated, costly, and difficult, especially in terms of repairing a poor credit score. However, debt settlement attorneys know of methods to help, and those experienced in this field can stand with a client until their problems are resolved and they are back on the road to a positive financial status once more.