The Fair Debt Collection Practices Act (FDCPA) is probably the most cited and referenced piece of legislation when it comes to debt collection. It was approved in 1977 with the goal of providing consumers protection from abusive debt collection practices and to facilitate fair debt collection practices. It is also supposed to provide consumers with a way to report companies that violate its regulations.
The FDCPA was designed to protect consumers from a third party debt collectors agency, which is defined as someone who regularly collects debts owed to others. This would include commercial debt collection agencies, but not companies that are attempting to collect debts in-house. However, some states have laws in place that require all companies to follow the FDCPA policies.
Even if your state does not require you to follow the FDCPA regulation, it may still be in your best interest to do so. The same can be said for international debt collectors. The easiest way to collect an outstanding debt is when the debtor wants to pay you. This situation is far more likely if you abide by these regulations.
The FDCPA requires that you identify yourself in every form of communication as a debt collector. Your debtor must be notified that any information they provide you with will be used to collect the debt that is owed. You are also required to provide the debtor with the name and address of the company that issued the debt if the debtor requests it.
As a debt collector, you are also required to notify the consumer of their right to dispute the debt. The debtor has 30 days from the receipt of this notice to demand that the creditor provide verification of the debt. This verification needs to include the amount owed and the information of the original creditor.
Many of the restrictions that are imposed by the FDCPA are common sense conduct issues that we have already covered in other posts. The act prohibits calling debtors before 8 AM and after 9 PM. It also required collectors to stop all communications if the debtor request so in writing.
There are also a number of situations where calling the debtor is forbidden. It is not acceptable to call a debtor at work if the employer has asked you not to do so. It is not acceptable to call a debtor if you have already been referred to their attorney. It is not acceptable to continually call someone with the intent to harass him or her. You also must cease all calling after the debtor demands verification of the debt until the debt is verified.
Many of the other restrictions implemented by the FDCPA are basic common sense. You are not permitted to misrepresent yourself to the debtor, and you cannot use profanity or threaten them. You are also not permitted to publish the details of their debt publicly or tell any other third parties about the debtor’s situation. It is also illegal to report false information on a debtor’s credit report.
While the FDCPA may or may not apply to your situation, following their guidelines should be standard procedure whether you are obligated to or not. If you are contemplating violating the FDCPA restrictions, the odds are very slim that you will actually collect the debt anyway. In those situations, you are always better to hand the collection process over to the professionals who won’t take the situation personally.