If you have ever known someone who has struggled with debt, you may be familiar with stories of rude, upsetting or even downright offensive debt-collector behavior. But, even though many consumers are not aware of it, there are legal limits on what creditors can do to collect payment. Knowing the basics about your rights during the debt-collection process is imperative to avoid creditor harassment.
The Fair Debt Collection Practices Act, known as the FDCPA, is a federal law that bars debt collectors from taking certain actions to secure payments from consumers.
A debt collector restricted by the FDCPA is someone in the regular practice of collecting money owed to others; for example, collection agencies, certain lawyers and firms that purchase unpaid debts are all subject to the provisions of the FDCPA. The FDCPA applies to most types of consumer debts. “Personal, family, and household debts” like mortgages, car loans, medical bills, or credit-card balances are all covered. The FDCPA does not apply to business debts, however.
Within five days of contacting you, a debt collector is required under the FDCPA to provide a written notice that contains the amount you owe, the name of the creditor and instructions detailing the proper procedure for disputing the debt. If you wish to dispute the debt and do so in writing within 30 days, the debt collector must cease collection efforts until it can provide you with written verification of the debt.
In addition to informational requirements, the FDCPA prohibits a number of behaviors that could amount to creditor harassment . For instance, a debt collector cannot call repeatedly or before 8 a.m. or after 9 p.m., threaten action the collector does not intend to take, use offensive language, make any false statement or commence with collection efforts after you have made a written cease-communication request.
Although the FDCPA provides broad protections, remember that creditors can take legal actions to force payments of underlying debts. Assets with liens on them may be seized, or bank accounts or wages could be garnished.
If you are facing debt-collection efforts, contact an attorney today to explore your options. Once you are represented by a lawyer, debt collectors are only allowed to contact you through your attorney. Furthermore, your legal representative can sue for creditor harassment if you have been treated unfairly in the collection process and may be able to collect monetary damages.
Remember, it is always better to address debt problems early on, and your attorney can help you find the best solutions for your individual circumstances.