Over the past decade, there has been a remarkable rise in blogs and websites that focus on helping consumers get themselves out of debt, improve their credit scores, and establish a sense of financial stability in their lives. But as with any good thing on the internet, there is also a lot of misinformation being spread as well.
Many financial bloggers will cite the Fair Debt Collection Practices Act as a type of “Get Out of Jail Free” card that can make even completely legitimate debts disappear in the blink of an eye. Not only is this completely unethical, it is also not true.
So with that in mind, let’s take a closer look at five of the most common misconceptions concerning the FDCPA.
Contacting Debtors is Illegal
One of the first mistakes that many bloggers teach is that any debt collector attempting to contact you is breaking the law. These people tend to confuse the terms inconvenient and illegal, but there is absolutely nothing illegal about a collector attempting to contact you about a legitimate outstanding debt.
In fact, many times this first contact is the best opportunity for a debtor to work out a deal with the collector, who is often willing to take less than the full amount owed in order to get an outstanding debt off the books.
Asking for Proof Will End the Conversation
Asking for proof that the debt is legitimate is a common tactic that is taught by those who blog about the FDCPA, and this is a great tactic to combat unethical collectors who are trying to rip you off. However, if we are talking about a legitimate debt and a reputable collector, the collector will already have proof of the debt in hand before making contact, so this stall tactic isn’t going to get you off the hook.
All Collectors are Commercial Debt Collectors
The FDCPA also draws a line between commercial debt collectors and people attempting to collect debts on behalf of their company. If you are behind on your payments to the local hardware store and the owner calls you to discuss the status of your account, the FDCPA does not apply.
Business Debt is the Same as Personal Debt
The FDCPA also distinguishes between business and personal debt. It is designed to protect consumers in regard to the latter, but does not apply to the former. So if the collectors contacting you are talking about outstanding business debts, once again the FDCPA will not get you off the hook.
Legitimate Debts Don’t Have to be Paid
At its core, the FDCPA is designed to protect consumers from predatory collection tactics that unethical debt collectors use to coerce people into paying debts that they don’t actually owe. But ethical collectors who are attempting to collect money that a debtor legitimately owes have every right to collect that debt, provided they are operating within the rules of the FDCPA.
By encouraging debtors to use the FDCPA to get them off the hook from paying legitimate debts, many bloggers are setting up consumers with false and unethical expectations that are bound to fail. Most legitimate collectors are well versed in the technical aspects of the FDCPA, and ethical collectors were following those rules way before it was signed into law.