Debt collection – your right to stop contact

Key Message:

  • A creditor or debt collector must not contact you about a debt if you tell them in writing not to contact you about the debt. However, the debt collector can make a genuine threat of legal action and issue legal proceedings against you.

Can a debt collector continue to contact me if I ask not to be contacted?

It is illegal for a person to contact you to collect a debt or repossess goods if you have already advised them in writing that no further communication should be made about that debt, unless the contact is –

  • an action issued through a Court or Tribunal; or
  • threatened legal action that the debt collector is entitled to take and intends to take;
  • to provide a default notice in relation to a credit contract (a communication with the person for the purposes of complying with the National Credit Code) .[i]

Why would I ask a debt collector to stop contacting me?

A creditor or debt collector might be causing you distress but have no real intention of taking legal action against you because:

  • your sole income is social security payments and you have no assets which can be seized through bankruptcy or legal action;
  • the debt is too small to cover the costs of taking legal action and/or there are significant questions about whether you are liable for the debt.

When would I tell a debt collector to stop contacting me?

Generally, you should only consider not paying a debt and telling the debt collector to stop contacting you if you are confident that if legal action is taken:

  • you have no income or assets that can be seized through bankruptcy or legal action and you are certain that it is in your best interests not to pay, or
  • you are prepared to defend any legal action and you fully understand any costs of doing so.

Be sure you fully understand the consequences of not paying a debt.  Consider whether your credit report may be affected, whether interest and legal costs may accumulate, whether there is any secured (or mortgaged) property that may be repossessed and whether you have any income or assets at risk.

If you are considering this option, and sending a letter asking not to be contacted, seek further information from Consumer Action.

What if I am still contacted by the debt collector ?

If the person collecting the debt continues to contact you, other than to issue or threaten legal proceedings which they are entitled and intend to take, you should make a complaint to Consumer Affairs Victoria.

You may also be entitled to claim compensation for any distress, humiliation or financial loss that the debt collector has caused. For more information see our fact sheets:

[i] Australian Consumer Law and Fair Trading Act 2012 (Vic) s 45(2)(m).

Sample letter

You can access a sample letter requesting a waiver by clicking: Debt collection – waiver request for consumers.

You can access a sample letter requesting that a debt collector stop contacting you by clicking: Debt collection – letter to stop contact.

Warning: This action sheet should not be relied upon as legal advice. This information applies only in Victoria and was updated in 6 June 2017.

Further information

Australian Securities and Investments Commission
Tel: 1300 300 630
www.asic.gov.au 

Australian Competition and Consumer Commission
Tel: 1300 302 502
www.accc.gov.au 

Consumer Affairs Victoria
Tel: 1300 55 81 81
www.consumer.vic.gov.au

Image from Barney Moss.


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