Posted by Fletcher Accounting and Tax Service Inc.

Everything You Need To Know About Fair Debt Collection Practices Act

Everything You Need To Know About Fair Debt Collection Practices Act

The behavior and actions of third-party debt collectors are trying to collect debts on behalf of another person or entity are limited by a federal law called the Fair Debt Collection Practices Act (FDCPA). The law was amended in 2010. Since then, it has been restricting the means and methods by which collectors can reach debtors and the time and number of times contact can be done. Within one year, a suit may be brought if the FDCPA violated the law against the debt collection company and the individual debt collector for damages and attorney fees.

How the Fair Debt Collection Practices Act Works

Debtors aren’t protected by FDCPA from those who are trying to collect a personal debt. If an individual owes money to the local hardware store, for example, and the store owner calls him to collect that debt, the owner is not a debt collector under the terms of his act. The act is only applicable to third-party debt collectors including those who work for a debt collection agency. The law also covers credit card debt, medical bills, student loans, mortgages, and other household debt.

Debt Collectors Contacting Debtors

Debt collectors cannot contact debtors at inconvenient times under the terms of the FDCPA. They are therefore not allowed to call before 8 a.m. or after 9 p.m. unless there is an arrangement for a call to occur outside of those hours by the debtor and the collector. For instance, if a debtor tells a collector that he wants to talk after work at 10 p.m, the collector then has the right to call. The debtor is not legally allowed to call at a certain time unless there is an invitation or agreement. Collecting a debt may also include sending letters, emails, or text messages.

A debt collector is required to send a written “validation notice” within five days of contacting a debtor containing the following:

  • How much money the debtor owes
  • The name of the creditor the debt is owed to
  • Instruction on what to do if you think the debt is not yours

Collectors Calling Debtors

Debtors can be reached at their homes or offices by debt collectors. However, if there’s a verbal or written message that tells a bill collector to stop calling his place of the employer, that number must no longer be called by the debt collector. If the debtor also doesn’t want the collector to call their home phones, he must also put the request in a letter and have it sent to the debt collector. It is best to have proof that the collector received the request to make sure to send the letter by certified mail and pay for a return receipt.

A bill collector can call relatives, neighbors, or associates of the debtor if he does not have contact information for a debtor. The bill collector may try to find the debtors phone number by contacting the people that the debtor personally knows but revealing any information about the debt is not allowed by the law. The collector is also not allowed to reveal that is he is calling from a debt collection agency as well. The collector is only allowed to discuss the debt with the debtor or their spouse. Collectors are also allowed to call third parties one time each only.

What Debt Collectors Can Do

The debtor can only be informed by the debt collectors about the debt and request payment. Collectors can work out a payment plan or settlement to help the debt pay the bill in some cases but the FDCPA has been created to protect debtors from harassment by bill collectors. They are not allowed to harass the debtor as stated by law and most importantly, cannot threaten bodily harm or arrest. If the collector lies or uses profane or obscene language, he is violating the Fair Debt Collection Practices Act. Unless debt collectors truly intend to take the debtor to court, he is not allowed to threaten to sue a debtor as well.

Why FDCPA Matters

The rights of every consumer are protected by regulatory acts like the Fair Debt Collection Practices Act in the context of debt repayment. Since the amount owed by a consumer can sometimes contain errors, debt collectors typically end up pursuing debtors with excessive and harassing tactics.

The collection tactics of debt collectors may be known to be aggressive but due to the existence of acts like the FDCPA, consumers are given more rights and assurance that collectors will treat them with respect and have the chance to contest the amount of debt they owe.

Fletcher Accounting and Tax Service Inc.
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