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The
Fair Debt Collections Practices Act
Knowing the rules will help you play the
collection game.
You
are protected by The Fair Debt Collection Practices Act, which
is federal law that protects consumers from harassment and
abusive collection styles. The Fair Debt Collection Practices
Act applies to collection efforts that are employed by persons
other than the original creditor "that regularly collect debts
owed to others." The FDCPA applies to third party collectors
who have purchased accounts or been hired by an "original
creditor" to collect on a debt. Original credit institutions
are not required to abide by the provisions set forth by the
act. Understanding the Fair Debt Collection Practices Act
and letting the creditors know that you understand your rights
is often one of the most effective ways of dealing with collectors
and their unsubstantiated threats.
FDCPA
When a debt collector calls:
When
a collector contacts you, at some point in the conversation
they must advise you that they are calling from a collection
agency. They are required to identify the name of the original
creditor and the amount of the balance on the account that
is being collected upon. This is important because it allows
you to determine whether it is a bill on which you feel your
are responsible for paying or on which you have a dispute.
If the collector was not required to advise you of the balance
and original creditor, you might pay on a bill that you are
not legally responsible for or you might pay more than you
are legally required to. The collector must advise you that
the purpose of the call is for collecting a debt and that
the information provided by you will be used for the purpose
collecting a debt. The collector is also required to advise
that you reserve the right to dispute the debt within 30 days.
FDCPA
Restrictions governing debt collectors:
Tactics
that are not permitted:
- The
debt collector cannot repeatedly call you.
- If
you request that collectors do not call you at work, they
must stop.
- Collectors
can not use foul language or threaten a consumer with violence,
seizure of assets, or imprisonment. They cannot use language
that is insulting, discriminatory or belittling.
- Without
obtaining your permission, collectors are not permitted
to tell any person other than yourself, a cosigner, your
spouse, or your attorney that you owe a debt.
- The
debt collector can not publish your name and the nature
of the debt. They may not threaten to harm your reputation
as a measure to collect a debt.
- A
debt collector cannot call you or in any way contact you
before 8:00 a.m. or after 9 p.m. in accordance with your
local time zone.
- A
collection agency cannot deposit a post-dated check prior
to the date on the check.
- A
collection agency cannot collect any amount greater than
your debt, unless allowed by law.
Rules
governing false representation:
- A
debt collector cannot misrepresent who he/she is. The collector
may not pretend that he/she is someone else or that he/she
represents a business or agency that he/she does not. A
collector cannot falsely imply that he is an attorney or
government representative. They cannot indicate that forms
or letters that are sent to you are legal forms if they
are not.
- The
collector cannot falsely imply that you have committed a
crime. They cannot threaten that you will be arrested if
you do not pay a debt.
- A
debt collector may not offer false information to get you
to pay a debt. In other words, a collector may not tell
you or write to you advising that he/she is going to sue
you, garnish your wages, or attach personal property if
he does not actually have the intent to do so.
- A
collector can not falsely represent that they work for a
credit bureau.
What
to do if collection activity becomes unbearable:
In
accordance with the FDCPA, if dealing with third party collectors
becomes unbearable you may send Cease and Desist Notification
to them, which requires them to stop contacting you. Frustrated
consumers do this when there is no end in sight to the constant
calls and emotional distress that unrelenting collection attempts
may be causing. When a debt collection agency receives Cease
and Desist Notification, they cannot communicate further with
the consumer with respect to the debt:
"except
-
- to
advise the consumer that the debt collector's efforts are
being terminated
- to
notify the consumer that the debt collector or creditor
may invoke specific remedies which are ordinarily invoked
by such debt collector or creditor: or
- where
applicable, to notify the consumer that the debt collector
or creditor intends to invoke a specific remedy."
Cease
and Desist notification is applicable to third party collectors
only. If you send a Cease and Desist letter to an original
creditor, they are not required to refrain from calling you
and they may respond negatively and heighten their collection
efforts. It is important to remember that sending Cease and
Desist Notification does not pardon you from repayment of
a debt. The fact that your life will be relatively more peaceful
does not mean that your obligations have gone away. If you
send Cease and Desist notification to your creditors, you
should continue to make consistent monthly payments to establish
that you are committed to paying back the balance owed. If
possible, try to pay about 2% of the balance on a monthly
basis. If you do not establish that you are committed to repaying
the debt, and the creditors cannot contact you, they may be
prompted to try to collect on the debt by suing you.
As
a safeguard, it is best to have Cease and Desist Notification
delivered by certified mail, return receipt requested, because
you will have concrete proof that the collector received it.
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