Fair Debt Collection Practices Act

How  Collection process works, collection consumer rights

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What exactly is the Fair Debt Collection Practices Act (FDCPA)?

15 U.S.C § 1692 et seq., is a United States statute aimed at eliminating abusive debt collection tactics while ensuring debtors the proper means to verify and dispute a debt. The FDCPA regulates debt collector conduct, outlines debtor rights, and lists fines and penalties for any infraction.

The Fair Debt Collection Practices Act FDCPA most specifically applies to third-party collector. While this means that in-house or internal collectors for the original creditor are not governed by these rules, there are, however, some states that have imposed similar restrictions on original creditors. It is also important to note that the FDCPA applies only to consumer debt. Thus, business debt is not covered in the statute.

The most important regulations outlined in the Fair Debt Collection Practices Act include the following:

What Creditors May NOT Do:

1. Call a consumer at inappropriate times. (Outside the hours of 8:00 am and 9:00 pm)

2. Call a consumer at work when they have been notified that this is not permitted.

3. Use the telephone as a tool to annoy or harass. This includes letting the phone ring continuously or calling repeatedly during the same day.

4. Use abusive or profane language.

5. Threaten or us any act of physical violence to harm the consumer or his or her property or reputation.

6. Contact a consumer once they have been notified in writing that the consumer has acquired legal representation.

7. Contact a consumer once he or she explicitly requests in written form for communication to cease or states that he or she will not pay the debt. While there may be certain exceptions, from that point on, the collector may only contact a consumer in the event of litigation.

8. Contact a consumer after he or she requests that the debt be validated in writing. The collector may not continue the collection process until the necessary documents to validate the debt have been mailed to the consumer.

9. Discuss the debts with a third party (not including a spouse or an attorney) or threaten to do so.

10. Publish the consumer’s name or private information in a “bad debt” list.

11. Threaten legal action if it is not legal in the consumer’s state or if the collector does not actually intend to do so.

12. Misrepresent their identities or be deceitful. For example, a debt collector may not claim he or she is an attorney or law enforcement officer unless this is true.

13. Contact consumers through mediums that may easily reveal the nature of the communication. Debt Collectors are not allowed to communicate via post cards nor through letters using letter-head that blatantly identifies that the correspondence is from a debt collector.

14. Report or threaten to report incorrect information on a person’s credit report

15. Claim that by not paying the consumer is in some why committing a crime.

16. Attempt to collect on unauthorized debt amounts.

Fair Debt Collection Practices Act guarantees the basic rights of consumers facing credit collection.

What Creditors MUST Do:

1. Identify themselves as debt collectors and inform the consumer that any information gathered from the communication may be used to collect a debt.

2. Send written notification of the debt within five (5) days of initial communication with the consumer. The letter must include

a. Debt Amount

b. Name of the creditor to whom the debt is owed.

c. A statement indicating that if a written dispute is not received with thirty (30) days then the debt will be considered valid.

d. A statement indicating that if the consumer does dispute the debt within the first thirty (30) days, then the debt collector will obtain verification of the debt.

e. A statement indicating that the debt collector will provide the name and address of the original creditor upon request within the first thirty (30) days.

3. Only file a lawsuit where the consumer lives or signed the initial contract of the debt.

Who enforces and supports the Fair Debt Collection Practices Act

The Federal Debt Collection Practices Act is enforced by the Federal Trade Commission. Violations of the act are penalized by a maximum fine of $1000.00 per infraction. To submit a complaint, contact the FTC:

Contact them via telephone using the toll-free number: 1-877-FTC-HELP

Submit your complaint electronically at : https://rn.ftc.gov/pls/dod/wsolcq$.startup

To ask for help about Fair Debt Collection Practices Act

Mail your complaint to :

Federal Trade Commission
Consumer Response Center
600 Pennsylvania Avenue, NW
Washington, DC 20580

You can also get more information on the Fair Debt Collection Practices Act e-mailing us.

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