Consumer Rights : Debt Collection

What actions can a collector take to demand payment?

It depends on whether the creditor, or the person or business to whom you owe money, is trying to collect its own debt or whether the creditor has sold or assigned the debt to a debt collector. In all cases, despite demanding payment, a creditor can legally do only three things:

  1. Stop doing business with you;

  2. Report your default to a credit bureau; and

  3. Sue you in court.

What can I do about harassment by debt collectors?

A federal law, the Fair Debt Collection Practices Act, prohibits debt collectors who are collecting debts for others from engaging in abusive or harassing conduct.

Unfortunately, this law does not cover creditors who are trying to collect their own debts.

You are not required to talk to debt collectors just because they call you. The calls are designed to shame you into paying the debt, because calling or writing are the only actions they can take short of filing a law suit.

The federal law has a number of provisions aimed at prohibiting collection harassment. Generally, it is illegal for a collector to contact your employer or neighbors about your debt, call you late at night, call you at work, call you repeatedly, make false threats, or engage in any other form of deceptive conduct or unfair harassment.

How do I stop a debt collector from harassing me?

To stop a debt collector from harassing you, you can write a letter telling them to stop.

This is sometimes called a “cease contact” letter. Once the collector receives your letter, they may not contact you again except to say there will be no further contact, or to advise you they intend to take some specific action.

If you are getting calls or letters from more than one collector, you need to send a letter to each one. Make a copy of the letter for your records and send the letter to the collector by certified mail so you can prove you sent the letter.

Sending the letter does not make the debt go away; it merely stops the calls and letters.

You can still be sued by the collector or the original creditor.

Can a debt collector garnish my wages or bank accounts?


A collector cannot garnish your wages or your bank accounts, or seize any of your property without first suing you and getting a judgment against you.

What can I do if I am having problems paying my debts?

If you have a lot of debts and you are having difficulty paying them, then you may want to see a reputable credit counseling agency for help sorting your bills, setting up a budget and negotiating payment plans with your creditors.

You may also want to consider filing bankruptcy.

What happens if I get sued by a debt collector?

If you get served with court papers, do not ignore them.

Open them and read them carefully.

In Ohio, you have 28 days to answer or respond to the complaint. If you disagree with the amount of money claimed, or you do not believe you owe the money, you should respond. This is called filing an answer.

For more information about how to file an answer, see the Courts & Hearings tab.

You should always read all the papers you get from the court or the attorney of the collector who is suing you. These papers have important information about court dates and other obligations.

If you have questions about any court papers you receive, you can contact your local legal aid program to discuss your situation.

What if I want to file an answer?

If you do file an answer, the court may set your case for a hearing.

You should go to the hearing and be prepared to explain to the judge why you disagree with the amount claimed, or why you do not believe you owe the money. Take any documents you have and any witnesses you have that will help you prove your case. The judge will then issue a decision.

What if I do not want to file an answer?

If you do not file an answer, the court may enter a judgment against you for the amount asked for in the complaint without requiring any more information from the creditor who is suing you.

This is called a default judgment.

You will not get any notice of this judgment from the court, and may only find out about it when you check your credit report, or apply for a loan, or when the creditor tries to collect.

What happens after a judgment is made against me?

Once a judgment is entered against you, either by default or by the judge, the collector can take steps to try to collect the judgment.

A judgment gives a creditor the right to try to collect money by garnishing your wages or your bank account, putting a lien on your real estate or by seizing some personal property. A creditor cannot do any of these things until it has a judgment against you.

You cannot be sent to jail for failing to pay a judgment, and you need to consider your financial circumstances before deciding whether to try to pay a judgment. You may be judgment proof and the suit will have little or no effect on your present financial circumstances.

What is garnishment?

Garnishment takes money that you owe someone from your paycheck before you get your paycheck, or from your bank account regardless of any outstanding checks you may have.

Once someone has sued you in court and gotten a judgment against you, they can file additional papers requesting garnishment of your wages or any bank accounts that you may have.

If the request is directed to your bank accounts, you will get a notice advising you of the garnishment, but all amounts over $400 in your account will be frozen by the bank, and the funds sent to the court.

The notice will tell you that you have the right to ask for a hearing to disagree with taking your funds.

You can read more about wage garnishment now.

What happens if I do not ask for a hearing?

If you do not ask for a hearing within the time indicated on your notice, your funds will be released to your creditor.

The creditor must ask the court for an order every time it wants to garnish your account.

If the request is to garnish your wages, you will first get a notice telling you that you can avoid garnishment by paying the amount calculated by you and your employer. The notice will have a work sheet for you to calculate the amount of your wages that can be taken.

If you do not return this notice with a payment or calculation showing your total earnings are exempt within the time given in the notice, the creditor will then go to court for an order to garnish your pay.

You will get a notice from the court telling you about the request and explaining that you can request a hearing if you disagree with the garnishment.

Once the court issues a garnishment order, every pay check will continue to be garnished without further orders until the amount of the judgment has been collected, or your circumstances change.

Will all my money go to the creditor?

Ohio law completely exempts some sources of income from seizure by creditors.

These include social security retirement or disability benefits, SSI, OWF and other public benefits, worker’s compensation and unemployment compensation.

If your benefits are directly deposited in your bank account, the money continues to be exempt. If you have more than $400 in your bank account, even if all the money is from exempt services, the bank will freeze the amount over $400.

If you get a notice of garnishment, you should immediately request a hearing. In the hearing request, you should write that the money in your account comes from an exempt source. When you go to the hearing, you should take documentation showing the source of your deposits. If you incur bounced check fees as a result of the garnishment of exempt funds, some banks may forgive these charges if you ask.

Is there a limit to the amount that I creditor can garnish?

Only 25% of your disposal earnings can be garnished by creditors.

Disposal earnings is the amount you earn for one pay period, after taxes have been taken out.

Can creditors take my home?

After a creditor gets a judgment against you, it can ask the court to issue what is called a Certificate of Judgment.

This certificate will be a lien against any real property you own. This lien must be paid before you can transfer your property to someone else.

If the judgment is large enough, and you have equity in your home, the creditor could force the sale your property. Ohio law gives you a $20,200 exemption in your residence, which includes either real property or a mobile home. Forcing the sale is expensive, so a lot of small creditors will wait until the sale or transfer to collect.

If a creditor is trying to force the sale of your home, you should consult an attorney immediately for assistance.

Ohio law also has an exemption for medical debts. If the lien is the result of a medical debt, then the creditor cannot force a sale of your home and must delay enforcement of the lien until a sale or transfer.

Can creditors take my personal property?

Ohio law has many exemptions, with limits, for your car and other personal property. These exemptions include the following:

  • $3,225 for one car
  • $1,075 for personal property

A complete list of exemptions can be found in the Ohio Revised Code 2329.66.

Before your property can be seized, the creditor must ask the court to issue an order called a writ. This writ will be carried out by the sheriff.

Usually creditors do not try to take personal property. If a creditor has seized some of your personal property, you should consult an attorney immediately regarding your rights.

What does “judgment-proof” mean?

When losing a law suit cannot hurt you, it means that you are “judgment-proof.”

This means that your income is exempt from garnishment, and you do not have any assets that can be seized by creditors and sold to pay your debt.

For example, if your sole income is social security disability, and you do not own your home, and you do not own a car worth more than $3,225, you are judgment-proof.

See also the Forms & Education tab in this section for more information.

The information in this site is not intended as legal advice.
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