What is the Fair Debt Collection Practices Act?

Third-party debt collectors can cross the line sometimes, and their harassment and profanities can come in many forms. Good thing you have the Fair Debt Collection Practice Act (FDCPA) to protect you against these cruel collectors.

Not only does the FDCPA make unsolicited and abusive debt collection illegal, but it also determines when and how many times can a debt collector call debtors. As such, a state establishes clear and fair debt collection practices.

So, if you’ve felt that your credit collectors have already gone beyond their boundaries, know your rights. You have more power than you realize.

Hiring the best debt defense lawyers will guarantee that you’re taking the proper legal action. Nonetheless, reading this blog post can also give you an idea of how the FDCPA works.

Fair Debt Collection Practices Act: An Overview

The FDCPA stands for Fair Debt Collection Practices Act. It is a federal law that provides consumers legal protection against abusive or predatory practices by third-party debt collectors. Based on its ethical guidelines, collectors are prohibited from harassing debtors or using false, deceptive, or misleading representations in connection with unfair debt collection practices.

Harassments can include calling a debtor at an inconvenient time and place or showing hostility towards the person who owes the creditor money. False or misleading representations are unlawful conduct suggesting that the debt collector operates or works for a credit reporting company, legal firm, or government agency.

How does the FDCPA work?

The FDCPA guidelines work by defining what the debt collector or creditor can and cannot do regarding contacting debtors.

For example, a collector “can” attempt to reach debtors at their homes or offices provided that the debtor gives an invitation or establishes an agreement. Without any written or verbal agreement, however, the collector cannot legally call the debtor at any time.

The FDCPA also gives debtors the right to express in writing a request to terminate all further communications or collection-related practices the third-party debt collector might perform.

Remember that verbally expressing such a request would not prevent the debt collection agencies from doing their activities. It will not stop them from filing a possible lawsuit against you or reporting negative information to a credit reporting company.

To respond to debt collectors accordingly, you must write a formal letter using the sample templates the Consumer Financial Protection Bureau (CFPB) provides.

How to respond appropriately to debt collectors?

If the collection agency first contacts you by phone, respond by saying they should send you a notification letter.

And anyone who claims you owe payment on a debt must disclose the following legally-required information:

•   The name of the creditor
•   The amount owed
•   A statement that you can dispute the debt
•   A declaration that you can request the name and address of the original creditor if different from the current creditor

Again, if the debt collection agency fails to respond accordingly, they have five days to send you a written notice containing the abovementioned information. And remember not to give your personal or financial information to the caller until you have confirmed the transaction’s legitimacy.

What are the most common FDCPA violations?

The Bureau of Consumer Financial Protection (Bureau or CFPB) and the Federal Trade Commission (FTC) continue to engage in various activities to supervise and enforce the FDCPA.

The CFPB is also required per 15 USC § 1692 m (a) to provide an annual report to Congress regarding the administration of FDCPA and other consumer protection-related debt collection responsibilities.

In their 2021 annual report, it stated that the bureau received approximately 82,700 complaints about first-party and third-party debt collection in 2020, an increase of approximately 10 % compared to 2019. This makes debt collection violations the most prevalent consumer complaints.

The most common FDCPA violations include:

•   Harassment of the debtor by the collector
•   Demands for monetary amounts that are not contractually legal 
•   Failure to send the consumer a written notice of the debt

Believing that you might have suffered from unlawful collection practices, you can contact the FTC and the CFPB through their toll-free numbers, as well as online forms, through which consumers can file complaints.

They take these complaints seriously and strongly encourage consumers to file an FDCPA lawsuit.

What are the exceptions to the Fair Debt Collection Practices Act?

FDCPA statutes do not cover all types of debt, and not all practices are prohibited by this law. For a debt to be covered by this Act, it must be owed by a person and not by a business.

Choosing to refuse all communications or negotiations with a debt collector might result in a lawsuit against you. Once your debt collector obtains a court order, they can garnish your paycheck.

Other debts that may not be covered are those not acquired voluntarily, such as parking and speeding tickets, domestic support obligations (e.g., child support and alimony), and income taxes.

What constitutes a false and misleading debt collection practice?

Not only does the law prohibit debt collectors from harassing or repeatedly calling debtors, but it also punishes those who make false and misleading representations.

When collecting debt, a third-party collector may not falsely represent or imply that he or she is vouched for, bonded by, or affiliated with the United States or any state, including the use of any badge, uniform, or similar identification.

Likewise, the debt collector must not also falsely represent the debt’s character, amount, legal status, any services rendered, or compensation he or she may receive for collecting the debt.

A misleading intent to usurp legal authority ( or a transaction from a legal representative) will also satisfy egregious conduct punishable by federal collection laws.

Also, threatening or accusing a consumer of a maliciously fabricated crime violates FDCPA regulations.

As mentioned earlier, the court advises the debtor to demand a written notice from the debt collector should these cases happen. This is to ensure the credibility and honesty of the involved debt collection party. It’s also one way to dispute debt claims and cease all the collection activities of the debt collector.

Need advice from debt defense lawyers?

Any ill attempt to trick you or take advantage of your financial struggles will never occur if you understand your rights. And these rights under the Fair Debt Collection Practices Act include

•   Verifying and disputing debt claims
•   Controlling how and when a debt collector may contact you 
•   Filing complaints against abusive debt collectors

Of course, you don’t just impose your legal rights. You have to seek some expert advice to learn how to sue debt collectors for FDCPA violations.

Deal with your debt with utmost optimism! Get in touch with the best lawyers from Northwest Debt Defense Law Firm today!