If someone owes a creditor money, they may start receiving letters and phone calls from debt collectors. It is important to note that these collection agencies are required to abide by the Fair Debt Collection Practices Act, which limits what they can and cannot do in the course of their attempts to have an individual repay a debt. Collection agencies are allowed to contact people through a variety of means, including in person and by phone, but when and how frequently is limited.
The only individuals that a debt collector is allowed to speak with regarding someone's debt is their lawyer and the person who is responsible for the debt. Collection agencies are also allowed to talk to friends and family, but they are only allowed to ask for current contact information and may not discuss someone's financial situation.
Collection agencies may call someone at their workplace, but they must stop doing so if an individual informs them that they are not allowed to take phone calls at work. Debt collectors are also limited in the times of day that they may call someone at home. Collection agencies are also not allowed to harass someone with constant and repeated phone calls, although this is a gray area since there are no specific limits on the number of calls that an agency can make.
While debt collectors are legally entitled to attempt to collect money that is owed, they must abide by a variety of regulations, which include not harassing individuals who owe money. If someone is dealing with creditor harassment, a lawyer may be able to assist them by explaining their rights and options, which may include filing for bankruptcy, depending on the circumstances. Bankruptcy offers a consumer protections from debt collects and might result in a discharge of some outstanding balances.
Source: Motley Fool, "Can a Debt Collector Really Do That to Me?", September 30, 2014