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The Fair Debt Collection Practices Act

By: LawInfo

Published: 11/2008

From time to time, many well meaning borrowers fall behind on their bill payments. It may be that the borrower has lost his or her job, has run into unexpected expenses or has simply borrowed more money than he or she can afford to repay. Whatever the reason, many borrowers who fall behind in their payments begin to receive phone calls from persistent debt collectors. Often, these calls come at inopportune times and can feel like harassment because the debt collectors can be very assertive.

The law recognizes that creditors need to be repaid the money which they are owed by borrowers and does not erase the debt. However, the law does recognize that the borrower should be treated fairly. In order to help ensure that borrowers are treated fairly, the Fair Debt Collection Practices Act was enacted.

What is Covered by the Fair Debt Collection Practices Act?

The Act applies to all personal household debts such as car loans, medical bills and, credit card bills. It does not apply to business debts.

Which Methods of Debt Collection are Regulated by the Act?

The Act allows a debt collector to contact a borrower by any method including telephone, fax, mail or in person. However, the debt collector cannot call you at inconvenient times or places. An inconvenient time is defined as before 8 am or after 9 pm. An inconvenient place could be a person’s place of employment if the debt collector knows that an employer would be unhappy with such contact.

You can also limit how a debt collector contacts you by writing the collector a letter. If you write a letter stating that you do not want the debt collector to contact you any further then the debt collector may send you one more letter acknowledging receipt of your letter and informing you of how he or she intends to proceed. For example, the letter might state that they intend to file a lawsuit against you for the money owed.

A debt collector may not discuss your debts with anyone other than you or your attorney. A collector could contact your friends or family to try and find out your whereabouts and how to contact you but a collector may not disclosure the fact that you owe money.

Most importantly, a debt collector may not harass you by threatening violence, using profanity or threatening to publicize your debt. Likewise, a debt collector may not be untruthful with you in an effort to collect money by claiming that you will be arrested or by sending you papers that appear to be from a court or government agency that are not in fact from one of those entities.

What Can You Do if You Believe the Act Has Been Violated?

You have several options available to you if you believe a debt collector has violated the law. You can report any alleged violations to your state’s Attorney General’s office or to the Federal Trade Commission. Either office can help you determine if the actions that you describe by the debt collector are against the law and will allow you to file a complaint against a debt collector.

You also have the right to sue a debt collector in court for alleged violations of the Act. You can do this individually or as part of a class action group against a particular debt collector.

It can be very stressful to owe money. Debt collectors have a legitimate role in trying to collect on a debt for a creditor who is legally entitled to the money that was lent. However, the Fair Debt Collection Practices Act makes sure that the debt collector’s actions are free from harassment, intimidation and illegal practices to protect the rights of the borrower.

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