Fair Debt Collection Practices Act

Understanding Your Rights – When Debt Collectors Violate The Law

In 1978, a law was passed that was specifically designed to protect all consumers from abusive practices by debt collectors, yet the Federal Trade Commission reports that it still receives more complaints about debt collectors than any other industry sector.

The Fair Debt Collection Practice Act (FDCPA) is a part of the Consumer Credit Protection Act, and it set clear guidelines for collectors. While the law may be over thirty years old, its basic concept is as valid for consumers today as it was then. When it was passed, the FTC felt that abuses were causing too many people to declare bankruptcy, and the act was implemented to minimize those numbers. During this time of economic decline, the average American consumer has fallen behind in paying back unsecured credit debts. Many have never been in a position before to receive calls from collectors and many don’t know that they do have rights.

Set Guidelines Protect The Consumer

The FDCPA sets forth rules for behavior for debt collectors, and it also describes solutions as well as penalties for any violations. When interacting with consumers, these rules must be adhered to at all times.

  • There are specific hours when debt collectors are allowed to telephone. Any call prior to 8 a.m. or after 9 p.m. constitutes harassment. Repeated calling is also not allowed and is considered an annoyance. They may not call a consumer at work. They may not call on Sundays.
  • They may not use threats of violence or harm of any type, use profane language or publish a list of names of people who refuse to pay their debts. They are allowed to provide the information to credit reporting companies however.
  • Debt collectors are not allowed to make false statements. They cannot claim the consumer has committed a crime, they cannot misrepresent the amount owed, and they cannot falsely claim that they are attorneys or government representatives. They cannot tell a consumer that forms are legal ones if they aren’t nor can they indicate that papers aren’t legal if they are.
  • They may not tell a consumer that they will be arrested for non-payment of a debt. They cannot threaten to garnish wages, attach or sell property or make any seizures unless they are permitted by law and have received permission to do so.
  • Debt collectors may not give out any false information about consumers, including to credit reporting companies.
  • The use of false names when contacting a consumer is prohibited. They may not allude to being a law firm.
  • Contacting third parties, such as an employer, relative or neighbor is forbidden.
  • They may not request post dated checks.
  • If debt collection agency does sue, it must be near your place of residence, and not in a far removed region.

Most importantly, a debt collection service must verify any notices in writing, and within five days of making initial contact with a consumer. They may not proceed with any collection attempts until the consumer has received verification, and must cease completely if a consumer requests them to cease communication in writing.

Help and Reporting Violations

The Fair Debt Collection Practice Act does not protect consumers from being sued, but its many rules do protect during the time of debt collection processes. Every consumer is protected by these rights, and violations can be reported. The consumer should also understand that most types of debts are covered by this act. Car loans, first and second mortgages, credit card accounts, medical bills, and household debts all fall under its rules. Many states also have their own laws which may encompass even more areas and conduct guidelines.

The E & Q Financial Solutions Group can help you find the right solution with a free consultation. You can fill out our short application and one of our debt specialists will contact you within minutes, or you can call now (866)892-3737.