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Fair Debt Collection Practices Act

Because debt collectors regularly violate the Fair Debt Collections Practices Act (FDCPA), it is imperative that consumers understand their rights under the FDCPA. Here is a brief summary what the FDCPA is, and some basic protections that it offers consumers. As with anything, the more you understand, the better equipped you are against deception. So read up and arm your mind against unscrupulous debt collectors.

What is the FDCPA?

The FDCPA, formally known as the Fair Debt Collections Practices Act, is a US Federal law that defines acceptable behavior of debt collection agencies and controls abusive tactics they may employ. The act was passed in 1977 in response to abusive tactics used by collection agencies. At that time, there was also considerable concern that such abusive practices were also contributing to a rise in personal bankruptcies. In the spirit of consumer advocacy, the act places restrictions on debt collectors who are seeking to collect legitimate debts while also providing consumer protection.

I have a variety of debts, are all of them protected under the FDCPA? Are any types of collectors exempt from the FDCPA?

The FDCPA protects you from harassment concerning medical, personal, family, household, car, retail, first and second mortgages, and credit card debts. Consumers should bear in mind that most states have similar laws, but some cover a broader range of debts. Also, the FDCPA covers third party debt collectors, or those that are hired by a creditor to collect a debt. If a creditor chooses to collect on their own accounts, they are typically not covered by the FDCPA. However, most states do have separate regulations that further regulate in house debt collection.

Who is a creditor allowed to talk with concerning the debt?

Primarily, the creditor is allowed to speak with the account holder about the debt. A collector may also contact a co-signer on a loan. The FDCPA prevents a creditor from speaking with somebody who does not own the debt, such as your neighbor, relative, or employer about your debt. If you are working with an attorney, the collector may speak with the attorney rather than you. Other than an attorney, a collector is only permitted to contact a third party once, and only to gain information about where you live, your current address of phone number.

How is a creditor allowed to contact me?

A creditor may not harass you with repeated phone calls, and cannot contact you between the hours of 9:00 pm and 8:00 am unless otherwise advised. They also cannot call you at your place of employment if you’ve explicitly verbally or in writing told the creditor that it is permissible to do so. Further, a debt collector may not use false means of gaining information about you, such as a fake survey.

What is considered abuse under the FDCPA?

  • Using violent, threatening, obscene language, or racial slurs is considered abusive conduct.
  • Threatening to pursue legal action, garnishment, repossession or harm to your credit when they don’t intend to follow up on those threats.
  • Falsely represent themselves as attorneys, government representatives, or even misrepresent the involvement of an attorney in collecting a debt.
  • Sending you any papers that look like legal forms when they are not, or that look like an official document from a government agency when they are not.
  • Collectors cannot deposit any post-dated checks prematurely
  • Making you accept any collect calls or sending you information via postcard
  • Falsely implying that you’ve committed a crime and will be arrested if you don’t pay your debt
  • Using a false name or number when contacting you, or falsely implying that they work for or operate a credit bureau
  • Collecting an amount greater than your debt, unless allowed by law
  • Taking or threatening to take your property unless this can legally be done
  • Suing a consumer in a state far removed from their place of residence

If a debt collector has violated any provision of the FDCPA, you do have rights and tools with which to fight back. You can:

  • File a complaint with the Attorney General in the state where the debt collector is located. If you are not sure how to go about this, contact the attorney general in your state and they will be able to point you in the right direction. By law, the debt collector may be fined $1,000 per violation of the FDCPA.
  • File a complaint with the FTC. However, be aware that the FTC will most likely only follow up on a complaint if there are many other complaints filed with the same company. Again, law stipulates that the collector can be fined up to $1,000 per FDCPA violation.
  • You can actually file a civil lawsuit against the collector if you have documented proof of FDCPA violations. These are most successful in small claims court because the burden of proof is relatively small in these courts.
  • You can also issue a cease communication to the collector. Verbal requests to stop communication will be honored for 30 days, and written requests must be honored until the consumer specifies otherwise. Further, if an attorney represents the consumer, the collector must communicate with the attorney.
  • Also, the consumer can request that the collector not call a place of employment if such calls are not allowed or may put the consumer in danger of losing their job. (this would result in the collector recouping little to none of the debt if the consumer has no money to pay).

Consumer Responsibility

  • Consumers need to be aware that though the FDCPA puts controls on the number and types of calls that collectors can make, it does not eliminate them altogether. In any case, collectors do have to show their correct phone number.
  • Consumers struggling with financial stress and collections calls should have a caller id on their phone so that they can document collections calls. Make note of any collection calls that are masqueraded as another number.
  • Document any other violations so that you can pursue legal action against a creditor.
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