• 29
  • September
    2011

Creditors are growing increasingly desperate to collect on their debts. In fact, some of them are becoming anxious that they are breaking the law to do it. Rapacious creditors are taking large risks mostly because they know that most debtors do not know the laws and are unlikely to challenge them.

The Fair Debt Collection Practices Act (FDCPA) is a federal law that lays out guidelines for any debt collectors attempting to collect on a debt. It was originally created to curb the swell of abuse from debt collectors and providing a means for consumers to challenge debts and report violations. The law also sets out penalties for debt collectors who violate it.

Prohibited Collections Conduct

The FDCPA outlaws a number of behaviors from collectors. Some of the most important limits are as follows:

  • Threatening to arrest or sue the debtor
  • Using profanity or other abusive language when speaking with the debtor
  • Annoying, harrassing or abusing the debtor by repeatedly calling them or repeatedly engaging them in conversation
  • Publishing the debtors name on a list of people with "bad debt"
  • Contacting a debtor who is represented by an attorney
  • Reporting false information on a debtor's credit report
  • Making misrepresentations to the debtor such as:
    • impersonating law enforcement
    • represent or are employed by a credit bureau
    • imply that the debtor has committed a crime
  • Providing any details about the debtor's debt to a third party

Although the Federal Trade Commission (FTC) and the newly created Consumer Financial Protection Bureau have the authority to enforce the FDCPA, debtors typically hire a Fair Debt Collection Practices Act lawyer to initiate a lawsuit against the collector for violations. According to a 2011 FTC report, in 2010 there was a 15 percent increase in debt collection complaints over the previous year.

Permitted Collector Conduct and What You Can Do About It

Generally, collectors are permitted to contact the debtor by telephone, fax, mail, telegram or in person between the hours of 8 a.m. and 9 p.m. When they do so, they must identify themselves as a debt collector, tell the debtor who they are collecting for and let them know the call is an attempt to collect a debt.

There are a few things that the debtor can do to stop collector calls. This may not prevent a lawsuit, but should provide him or her with a brief respite. The debtor can send a written letters to the collection agency advising them of the following:

  • they no longer wish to receive any written communication from them
  • the need to provide the debtor with the name and address of the original creditor or validation that the debt exists
  • they are not permitted to contact the debtor at work

Ultimately, these letters will only hold off debt collectors temporarily and they will not prevent a creditor from filing a lawsuit to obtain a judgment. Also, it is important to note that the FDCPA applies only to debt collectors and does not apply to the original creditors themselves.

Individuals saddled with debt who have become afraid to answer their telephones should take action before their creditors do and ought to explore filing for bankruptcy for a fresh start and long term relief.

Sources: www.findlaw.com, "The Fair Debt Collection Practices Act" and

www.ftc.gov, "FTC Submits 2011 Fair Debt Collection Practices Report to Congress," 21 March 2011