If they are creditors who collect their own debts, they are not doing so. Under the FDCPA, debt collectors can include collection agencies, debt buyers, and attorneys. Any debt collector covered by the FDCPA who contacts you regarding a debt must provide you with certain information about it. The Fair Debt Collection Practices Act (FDCPA) is a federal law that protects debtors against abusive collection tactics by debt collectors. Congress created the FDCPA to prohibit debt collectors from using unfair, deceptive, or abusive practices when collecting consumer debts.
The FDCPA generally only applies to third-party debt collectors, not to original creditors. A creditor is defined as the person or entity that granted you the credit in the first place (the original lender). A creditor can try to collect an outstanding debt in a number of ways. However, due to “abundant evidence” of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors, (15 U.S.
UU., C.) The FDCPA prohibits outside debt collectors from contacting a debtor directly if they know that the debtor is represented by an attorney. In addition, in their first communication with the consumer, debt collectors are required to “notify debtors of their ability to challenge the validity of a debt” and to provide other basic information. Photos c.NCO Financial Systems, Inc. This includes informing the debtor of their right to ask the collection agency to “validate” the debt.
In addition to administrative enforcement (15 U.S. UU., C.) Preliminarily, the FDCPA generally applies only to third-party debt collectors; the legal system was not intended to cover the conduct of the original creditor. However, some states, such as California, have enacted consumer protection laws that provide broader coverage than the FDCPA, and may include the conduct of the original creditor in their scope. The FDCPA allows these types of state laws.
For more information on the FDCPA, see this article from the University of Berkeley Law Review, this Brooklyn Law Review article, and this section. The FDCPA provides debtors with a means to challenge payment demands and to determine validity and accuracy. of declared debts. The FTC has gone to court to challenge FDCPA violations committed by companies that used other names to collect their own debts.
Perhaps most importantly, however, the FDCPA establishes ethical guidelines for the collection of consumer debts. Article 803 (of the FDCPA) defines a “debt collector” as “any person who uses any instrument of interstate commerce or the mail in any business whose primary purpose is the collection of any debt, or who regularly collects or attempts to collect, directly or indirectly, debts due or overdue or that he claims to owe or owe to another person. The Fair Debt Collection Practices Act (FDCPA) states that debt collectors cannot harass, oppress, or abuse you or anyone else they contact. The FDCPA prohibits debt collection companies from using abusive, unfair, or deceptive practices to collect your debts. Therefore, in addition to the charges filed under Section 5, the lawsuit accused them of violating the FDCPA, including illegally garnishing consumers' paychecks and disclosing the existence of debts to people other than the debtor.
The FDCPA covers the collection of debts that are primarily intended for personal, family, or household purposes. However, if a creditor is collecting their own debts and using a different name than that way, the creditor is not exempt from FDCPA. In addition, the FTC has taken action under Section 5 when first-party creditors engage in other practices that are expressly prohibited by the FDCPA, for example, by disclosing the existence of a debt to anyone other than the debtor. The Fair Debt Collection Practices Act (FDCPA) is the primary federal law governing debt collection practices.
The FDCPA even gives debtors the right to require that the outside collector cancel all other communications, but the demand must be made in writing. In addition, the FDCPA does not apply to business debts, to government agencies that collect debts, or to people who are not usually engaged in the business of collecting debts. Because the FDCPA is designed to protect debtors from third-party debt collectors, it doesn't usually apply to original creditors. Therefore, for those accounts, Green Tree put on the extra “debt collector” hat subject to the FDCPA.
