An Overview of the Fair Debt Collection Practices ACT

Debt collectors and collection agencies are famously infamous for the plots and tactics that they make use of to collect back the debts for the creditors. However, most of these collection agencies go scot-free because of the ignorance of the creditors that hire them. Unfortunately, most of the consumers are unaware or uninformed about the laws governing the cans and cannots of the dealings between the creditors and the collection agencies while recovering the outstanding debt.

The Federal Debt Collection Practices Act is commonly known as FDCPA. It is a special federal law or rule which administers or regulates the actions of agencies acting as collectors of debt for personal debts or loans like credit cards, medical bills, auto finance or home loan.

Permissible Practices for Collection

Any third party appointed by your creditor for debt-collection would have to compulsorily follow the rules and regulations laid down by the FDCPA. However, under the Act of the FDCP, debt collectors or agencies cannot do the following—

• The collectors cannot call you at anytime of the day. The fixed timings are from 8 am to 9 pm.
• They cannot ring you at your workplace, especially if the collection agency knows that your employer or manager is unapproving of such calls.
• The collectors cannot cause harassment to you, oppress you or use profanity with you.
• These agencies cannot mislead or misinform you or in any way imply that you are a criminal or have committed an offence by not paying back the debt.
• In order to recover the dues, they cannot employ unfair practices.
• Over the phone, the collectors cannot cover or conceal their true identity.
• They cannot disregard or not pay heed to any written request from the debtor to stop further communication.

Guidelines for Correspondence

Special norms have been laid down by the FDCPA for communication between debt collectors and people other than creditors. The collection agencies are strictly prohibited from divulging any information about your debt. This information can only be shared with you, the debtor himself, your spouse or the parent if the debtor is a minor.

Communication via a post card or usage of any sort of language, symbol or sign on the envelope which would clearly confirm the debt-collector’s identity as a debt collector is not given consent to. If the debt collection agency is aware that you have an attorney as a representative and if they have the contact details of the attorney, then the debt collector should only communicate and contact the attorney.

Collection agencies or collectors are forbidden from employing any kind of abuse or harassment during debt-collection. The collector cannot threaten violence or damage against the consumer, his reputation or his property. The collectors of debt cannot use profanity or obscene language or behavior while communicating with the creditors through mail or over the phone. Except to a credit bureau, debt collection agencies cannot publish or submit a list of creditors that have outstanding amounts.

Violation of your rights

Any violation of rights under FDCPA gives you a time period of a year from the day violation took place to file a case against the collection agency. You could get an additional $ 1000 apart from the attorney fee and actual damages.

Note: This should not be considered legal advice. Debt Regret does not provide legal or tax related advice. If you need any type of legal or tax related advice, you must contact a licensed attorney or a qualified accountant.