Have you ever received annoying and persistent calls from credit collection agencies about certain debts that you may or may not owe or that you are trying to pay off? You do have rights when it comes to how these creditors and collection agencies operate.
The Fair Debt Collection Practices Act (FDCPA), found under 15 U.S.C. § 1692et seq, was promulgated in 1978 and is designed to protect consumers like you from deceptive and abusive practices by collection agencies and creditors who are attempting to collect a consumer debt. The FDCPA (ACT) does not apply to commercial or business debts. Consumer debt refers to household, personal or family debt such as credit cards, car loans, and payday loans. The Act does not apply to student loans or mortgages.
Each state has its own version of the FDCPA but it may not be inconsistent with the federal law unless its provisions are more protective of the consumer.
Validating the Debt
When contact is initially made by the creditor, you have 5 days to pay the debt. Afterward, the creditor must inform you of the following in writing:
Amount of the debt
Name of the creditor
That you have 30-days to dispute the debt before the creditor may assume it is valid
If you dispute it, the creditor must provide you with verification of the debt
If you request it in writing within 30-days, the creditor or collection agency must provide the name, address and phone number of the original creditor
No collection efforts can be made if you dispute in writing the debt’s validity or ask for the original creditor’s identity within the first 30-days of contact. If requested, the creditor must provide proof of the debt’s validity or name, address and phone number of the original creditor. If the debt is valid, you may wish to work out a payment plan or compromise. If not, contact an attorney for advice.
Many consumer complaints refer to harassing phone calls at home or at the debtor’s workplace. Under the Act, creditors may not place collection calls at unusual hours. This usually means that calls may not be made before 8:00 a.m or after 9:00 p.m. Calls may not be made at your place of work if the creditor has reason to know that your employer forbids such calls such as your advising the creditor. Also, if you have a lawyer and give the lawyer’s contact information to the creditor, then calls are only to go to your attorney unless the attorney is unresponsive or allows the creditor to contact you.
You can also advise the creditor to cease making collection calls to you. Once you do, the creditor can only state that collection efforts will cease and that specific remedies may be pursued.
A collector may, however, contact third parties for information about your whereabouts after identifying itself and stating that he/she is trying to locate you. No information about your debt may be revealed or that you owe one unless the third party specifically inquires.
Misleading or False Representations
If you experience any of the following practices, the creditor may be in violation of the Act:
That you will be arrested or imprisoned for nonpayment
Giving false credit information or false information about the debt
Advising you that you have committed a crime
Using or distributing documents that resemble official court documents
Using false information or deception to obtain information about you
Falsely stating that certain documents are a legal process or that they are not
Stating that the creditor is from a consumer reporting agency
There are also certain unfair practices that are prohibited. For instance:
Soliciting a post-dated check to use as a threat
Using a postcard to notify you of a debt
Collecting or attempting to collect any expense incidental to the debt unless authorized by law or by the original debt agreement
Accepting a check postdated more than 5 days unless written notice is given to the consumer of the intent to deposit it and notice is given no more than 10 nor less than 3 business days before the date of the deposit
Taking or threatening to take your property if the creditor has no enforceable right to it or does not intend to do so
You can collect any actual damages that you incurred as a consequence of the creditor’s deceptive practices. Punitive damages in the amount of $1000 may also be awarded. If a class-action suit, the creditor may be liable for $1000 per plaintiff and up to $500,000 or 1% of the creditor’s net worth, whichever is greater, to be divided among the class action plaintiffs. Costs and reasonable attorney’s fees may also be awarded.
We would be happy to answer more questions about your specific consumer debt collection matter if you prefer to give us a call at 304-245-9097. Ask for Steven.
Steven S. Wolfe, Esq.