Debt Collection

Renting and Debt Collection Basics

Common questions about debt collection and renting include:

Does my landlord qualify as a "debt collector"?

No. The landlord is the creditor.  A debt collector is the person the landlord hired to collect the money they believe is owed to them.

Can a landlord sue for unpaid rent?

Yes. Under Wisconsin law, if there is a written contract, the landlord can sue (usually in small claims court) for money owed under that contract for up to 6 years.

What can I do if I don’t think I owe the money?

You must write to the debt collector within 30 days that you are disputing the debt and give reasons why. 

What does debt collection have to do with me as a tenant?

Under Wisconsin law, if you have a written agreement or lease (contract) for housing, your landlord can sue you for rent you have not paid. In other words, the landlord can take you to court and try to get the court to order you to pay the debt.

Before a landlord can sue you for not paying rent:

  • The landlord has to first tell you that you haven't paid rent (that you are "in default") and give you a chance to pay. 
  • After that, the landlord can sue you.
  • The landlord must sue within 6 years of the date when you last paid rent. 
  • Usually the lawsuit happens in small claims court.  All lawsuits for under $10,000 must be filed in small claims.

So what does all this have to do with debt collection? Unpaid rent is a debt. The landlord might hire a debt collector to get you to pay the money they say you owe, for example, by calling you or sending you letters. State and federal laws (“consumer protection laws”) prevent the debt collector from doing certain things, like harassing you or calling you at certain hours of the day.

The information on this page is about your rights in relation to debt collectors, whether those debt collectors are trying to get you to pay unpaid rent, or another debt (like credit card or medical debt).

Can I be sued if I don’t pay a debt?

Yes. To sue you for the debt, first the creditor (a person or company to whom money is owed) must notify (tell you in writing) you that you are in default (you didn’t pay the debt), and give you the chance to repay the debt. The creditor is the person to whom the money is owed (the landlord).

What should I do if a debt collector contacts me?

Keep a record of the contacts -- “make a paper trail.” 

  • If the contact is by letter, keep the letter and its envelope. 
  • If the contact is by phone, ask for the full name of the person making the call, the company for which they work, and the creditor's name. Write down the time and place that you receive each call and a summary of what is discussed during the call.
  • If the contact is by text or social media, take screenshots.
  • If the contact is by email, save the email or take screenshots.
  • If you reach out to the debt collector (for example, you call them or send a letter), you should also keep a record of when you contacted them, how you contacted them (by letter, phone, etc.), who you talked to, and what they said. 

Debt collectors sometimes violate consumer protection laws when they contact you and keeping records can help you prove a violation of the law happened. The records can help you prove important facts if you file a complaint with the Wisconsin Department of Financial Institutions or sue the debt collector.

Can a debt collector contact me at any time and any place?

No. Debt collectors can never contact you before 8 a.m. or after 9 p.m. Debt collectors also cannot contact you at a time or place that they know is inconvenient for you. If you notify debt collectors that a particular place or time of day is inconvenient for you, they must stop calling at that time or place. It is best to notify debt collectors of any inconvenient time and/or place in writing and keep a copy of the letter for your records. The Consumer Financial Protection Bureau has sample letters you can send to tell the debt collector not to contact you.

What else can't debt collectors do?

In general, debt collectors may not harass consumers, their spouse, or any member of their immediate family. Harassment includes: 

  • Using threatening or obscene language
  • Threatening violence
  • Impersonating a law enforcement officer
  • Threatening criminal prosecution. 

In addition, a debt collector may not misrepresent information in an attempt to collect the debt -- for example, the debt collector can’t lie to you about the amount of the debt, or say they will take legal action that they can’t actually take. 

Finally, if a debt collector knows that you are represented by an attorney in connection with the debt, the debt collector cannot contact you directly.

Can a debt collector contact my employer?

A debt collector may only communicate with your employer to verify your employment or earnings.

What can I do if I feel a debt collector is harassing me?

  • Notify the debt collector in writing that you no longer wish to be called. If you do, the debt collector must stop calling. If the debt collector continues to call you, refer them to your letter and politely hang up. Keep a copy of the letter you write to the debt collector. Log any further calls.
  • Contact an attorney. Filing a lawsuit under federal and state unfair debt collection laws may entitle you to recover any money you might have lost, including damages for emotional distress, and your attorney's fees if you are successful. However, even if a court concludes that the debt collector violated the law, you will still owe the debt, unless the creditor agrees to write it off.
  • File a complaint with the Wisconsin Department of Financial Institutions at (608) 261-9555

What if I believe I don’t owe the debt?

You must write to the debt collector that you believe you don’t owe the debt (you are “disputing the debt”) and give reasons why. You must notify the debt collector of this in writing within 30 days of receiving their notice. The Consumer Financial Protection Bureau has sample letters you can send to dispute the debt.

Can a creditor repossess my personal property if I default on my payments?

Yes, but they might have to go through some legal steps first. If the property was worth less than $25,000 at the time of sale, the creditor can’t take it back without a court order. (Wisconsin law prohibits "self-help" repossession of property—repossession without a court order—obtained by credit for personal use that is valued at $25,000 or less at the time of the sale.)

A creditor cannot repossess personal property unless:

  • The creditor files a lawsuit against you for nonpayment on the debt and obtains a judgment from the court; or
  • You voluntarily surrender the property.

The law also prohibits a repossession that "breaches the peace" or creates a disturbance, especially one involving confrontation or unnecessary noise.

If you are served with papers, you may want to seek the advice of an attorney. A list of attorneys is available on this website.

When can a creditor garnish my wages?

“Garnishing wages” means that a certain part of your pay is taken out of your paycheck, in order to pay back the debt. To garnish your wages, creditors must go through the courts. The opportunity to garnish and the amounts that may be garnished are quite limited. For example, a creditor cannot deprive you of the ability to pay for basic necessities. Wisconsin law does not allow garnishment that would drop you below the national poverty level for your family size.

Used with permission of the Consumer Law Clinic - UW-Madison Law School.