Dealing with Debt Collectors

The Fair Debt Collections Practices Act, or the FDCPA, is a federal law passed by Congress in 1978 to ensure that consumers will be treated fairly in regards to debt collection.  The FDCPA prohibits debt collectors from using abusive, unfair, or deceptive practices when trying to collect a debt.  It does this by limiting how and when a debt collector may contact you and what they can say to you, giving you the right to dispute a debt, and giving you the right to make debt collectors to leave you alone. 

When does the FDCPA Apply?

However, the FDCPA only applies to companies or people who are “debt collectors.” A debt collector is someone who regularly collects debts owed to others.  This generally includes debt collection agencies, creditors using false names or collecting for other creditors, collection attorneys, purchasers of delinquent debts (debt buyers), and repossession companies.  Because these people or agencies are collecting on a debt owed to someone else, they are “third party” debt collectors.

The FDCPA does not apply to creditors collecting their own debts.  For example, many credit card companies have their own collection departments.  When the credit card company is trying to collect on the debt you owe to them, the FDCPA protections don’t apply.  However, after a period of time, the credit card company might turn the debt over to a collection agency.  When the collection agency tries to collect on the debt you owe to the credit card company, the FDCPA does apply.

Your Rights under the FDCPA

Dealing with a debt collector can be scary, but remember, you have rights. The FDCPA prohibits unfair, abusive and deceptive debt collection practices by third party debt collectors.   What are some practices considered abusive, unfair, or deceptive?

Harassment. Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:

• use threats of violence or harm;
• contact you before 8 a.m. or after 9 p.m.
• call you at work if you have asked them to stop.
• call you an unreasonable number of times, or repeatedly use the phone to annoy you.
• publish a list of names of people who refuse to pay their debts, or threaten to tell someone about your debt (but they can give this information to the credit reporting companies);
• talk to others about your debt without your permission
• use obscene or profane language;

False statements. Debt collectors may not lie when they are trying to collect a debt. For example, they may not:

• falsely claim that they are attorneys or government representatives;
• falsely claim that you have committed a crime;
• falsely represent that they operate or work for a credit reporting company;
• misrepresent the amount you owe;
• indicate that papers they send you are legal papers if they aren’t; or
• indicate that papers they send to you aren’t legal papers if they are.

Debt collectors also cannot tell you:

• you will be arrested if you don’t pay your debt;
• they’ll seize, garnish, attach, or sell your property or wages, unless they are permitted by law to take the action and intend to do so; or
• legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.

Debt collectors may not:

• give false credit information about you to anyone, including a credit reporting company;
• send you anything that looks like an official document from a court or government agency if it isn’t; or
• use a false company name.

Unfair practices. Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:

• try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
• deposit a post-dated check early;
• take or threaten to take your property unless it can be done legally; or
• contact you by postcard.

However, there are some things debt collectors can do.   They can talk about your debt with your spouse and your lawyer (if you told them your lawyer’s name).  They can call your employer to make sure that you work there or get your contact information. And, they can sue you in court. 

More Rights under the FDCPA

Importantly, the FDCPA gives you the right to stop the debt collector from contacting you, even if you don’t dispute the debt. It also gives a consumer the right to dispute the debt and require a collector to verify the existence, legality, or amount of the debt it is attempting to collect.

The next two sections discuss how you can go about stopping all collection contacts, and how to request a debt collector to “verify the debt” if you dispute it.