We were surprised to learn that many American consumers aren’t familiar with a 1978 law, The Fair Debt Collection Practices Act, or FDCPA. Its primary purpose is to closely monitor and when necessary, investigate, collection agencies. And collection agencies are doing good business in this tough economy.
It outlines very specific compliance regulations and the consequences if a credit agency (and in some states, the original creditor) crosses the line. It was founded in an effort to eliminate the growing number of consumer complaints that debt collectors had become very abusive – again, remember, it was founded in 1978.
The country was less than a year away from a major recession (sound familiar?) and the unemployment rates were already beginning to inch up. It had already hit the 6% mark and once the recession hit, it would eventually reach almost 11%. Clearly, Americans were struggling with making their credit card payments and other financial obligations. When you’re in a vulnerable position with no job and entirely too many bills coming due, it often places you in a very vulnerable position, especially if abusive credit collectors begin calling countless times a day. There’s no denying abusive debt collection efforts were alive and well.
There was considerable “back and forth” before the bill finally make it through and became a federal law. There were some collection agencies that said they were exempt due to their legal business classification was that of a legal structure. Those claims were quickly dismissed by the courts. In fact, the ruling, when it came down, stated emphatically that a debt collector was anyone that communicated with a consumer with the goal of collecting or attempting to collect debts owed.
This law was very clear in what debt collectors could and could not do in their efforts of collecting debt. First, they are required to honestly identify themselves. Whether it’s via written communication, face to face communication or conversations held over the phone, they must present themselves accurately.
Once the debt collector identifies himself, he must then give proper notice of the consumer’s right to dispute that debt. This notice, a 30 day §1692g notice, must be provided within five days of making contact with the debtor. This 30 day notice means the debtor has thirty days to review the notice and request verification of the debt.
Because debts in collections are often bought and sold several times, the bill collector must identify the original company it works for. For instance, if your Visa credit card is behind by 120 days, you might be conversing with a third party agent, but that agent must tell you that he’s been hired to collect the Visa debt. Not only that, but if, after you receive the 30 day notice, you want the debt verified, it’s your legal right to declare and then receive it.
There were also other limitations that included limitations on how late or how early a collector can call you on the phone. A collector can only contact you between 8 a.m. and 9 p.m. and it’s based on your time zone, not the debt collector’s.
The law also made it clear what debt collectors could not do. At the top of that list is any effort to misrepresent themselves. They can’t claim to be a family member in order to get a phone call past your employer’s receptionist. They also may not claim to be an attorney or an employee of the original creditor.
Speaking of phone calls, if a debt collector is harassing you for that past due credit card balance, you can tell the creditor to back off. A collector simply does not have the right to harass you, call you incessantly or annoy you in any way. It’s that simple; however, there are legal avenues the collection company does have access to, including filing suit.
Debt collectors, according to the Fair Debt Collection Practices Act, cannot make empty threats to sue you. This is a challenging aspect of the law, since it’s difficult to prove a threat was made, but not carried out. You are also protected from abusive or foul language.
You might be surprised to learn, too, that debt collectors may not mail you via post cards nor can it make it known on any envelopes that it’s a debt collection company. It may use its name, provided it doesn’t reveal the nature of the business. Another consideration regarding one’s privacy is the right you have to not be contacted at your place of employment. You have the right to ask a debt collector to not do so.
These are just a few of the guidelines in this law that was devised out of similar economic times that we’re currently in. If you feel as though a creditor is acting against the law, you might wish to contact an attorney.