The Fair Debt Collection Practices Act (FDCPA) is a federal law that limits what debt collectors can do when they attempt to collect certain types of debts. The Federal Fair Credit Reporting Act (FCRA) regulates how debts are reported on credit reports. In addition, there are state laws that provide protection against unfair and deceptive practices. The FDCPA only applies to third-party debt collectors, such as those who work for a debt collection agency. The law covers credit card debt, medical bills, student loans, mortgages and other types of family debt.
A creditor may 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 counsel. In addition, in their first communication with the consumer, debt collectors must “notify debtors of their ability to challenge the validity of a debt and provide other basic information.” Photo against 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, C. Preliminarily, the FDCPA generally applies only to third-party debt collectors; the legal scheme was not intended to cover the conduct of the original creditor). However, some states, such as California, have enacted consumer protection laws that offer broader coverage than the FDCPA, and may include the conduct of the original creditor in their scope of application.
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 applies to any person or business that regularly collects someone else's debts. Employees of debt collection and purchase agencies must comply with the FDCPA.
Law firms and attorneys must also comply with the FDCPA if they engage regularly to debt collection activities. In practical terms, most debt collectors are covered by the FDCPA. Under this law (Title VIII of the Consumer Credit Protection Act), third-party debt collectors are prohibited from using deceptive or abusive conduct in the collection of consumer debts incurred for personal, family or household purposes. These collectors cannot, for example, contact debtors at odd hours, subject them to repeated telephone calls, threaten them with legal action that is not actually contemplated, or reveal the existence of debts to others.
If you believe that a debt collector has violated the FDCPA, you can contact the Consumer Financial Protection Bureau (CFPB) or your state's attorney general. The Consumer Financial Protection Bureau (CFPB) Debt Collection Rule clarifies the FDCPA's rules for how debt collectors can contact debtors.
