Thanks to the creation of the Fair Debt Collection Practices Act (FDCPA), consumers are protected from creditors when it comes to certain debt collection practices. Here, we outline some of the more common and important restrictions placed on debt collections and collection agencies.
Illegal Debt Collection Practices Under Law
The FDCPA requires that a debt collector or collection agency must provide certain disclosures and also prohibits the collector(s) from taking part in deceptive or abusive collection behaviors.
Here are some actions that creditors and collectors and prohibited from conducting under the FDCPA.
Communication with Others
A collection agency cannot discuss your debts to third parties, such as co-workers, neighbors, and family members. Collectors and agencies are allowed to contact:
- Your attorney
- A credit reporting agency
- The original creditor or lender
Collectors may contact your spouse, your parents if you are a minor, an any co-debtors listed on your accounts. However, creditors cannot contact these sources if you have sent a letter asking them to stop contacting you.
Sadly, there is one exception to all of this. A debt collector is able to contact third parties for the sole purpose of finding a person’s whereabouts. When a debt collector contacts a third party for your whereabouts, they must:
- State their full name and state that they are searching for your location
- Not identify their employer unless asked
- Not state that you owe a debt
- Not contact another party more than once unless required to do so by the party, or unless there is reason to believe that the parties earlier response was false or incomplete.
- Not contact any third parties for location information if you have an attorney representing you
Debt Collector Harassment and Abuse
Generally, a collection agency is unable to harass or oppress a debtor. A collection agency cannot:
- Use or threaten violence
- Use abusive or obscene language
- Publish your name as a person who does not repay debts (many states allow this for child support in some cases)
- Call you constantly and call you without identifying themselves as a creditor or collector
- Threaten to harm you or members of your family, or harm the reputation of you or another person
False and Misleading Information
A debt collector cannot lie. Debt collectors and collection agencies cannot:
- Claim to be apart of law enforcement or claim to work with federal, state, or local governments
- Falsely state the amount owed or the amount up for collection
- Claim that you will be imprisoned or your property seized
- Claim that you have committed a crime by being in debt
- Claim to be an attorney or other form of legal aid
Bad Collection Practices
Debt collectors are prohibited from taking part in any outrageous methods to collect a debt. A collection agency cannot:
- Add additional fees or interest charges not authorized by law
- Deposit a postdated check before the date on the check
- Charge communication charges, such as a call fee
- Threaten to seize property if they have no right to do so
- Communicate by postcard
- Place any symbol on the outside of an envelope sent to you that indicates a bill is trying to be collected.
All in all, consumers should be wary when it comes to certain debt collection practices. Debt collectors are notorious for falsifying information when it comes to debt collection. Knowing your rights as a consumer is the first step in battling unfair and illegal collection practices.
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