The Fair Debt Collection Practice Act…a Powerful Credit Repairing Tool

Some of the tactics debt collectors can do are just plain dirty, right? They can call you all through-out the day and night; they can harass you with threaten letters and phone calls; they can contact relatives, friends and colleagues; they can do whatever it takes to get you to fold and pay them the money. Or can they? While it’s true that most commercial debt collection agencies operate within the law; however, a vast majority do not. Still yet, like any other business venture, debt collection agencies are in the business to make a profit. Perhaps it’s this great potential for profit that causes some debt collectors to operate beyond the scope of the law. Nonetheless, it seems that a large number of consumers are still unaware that they have specific rights and protections against rouge collection agencies. What’s the Fair Debt Collection Practice Act (FDCPA)? The FDCPA creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors, and prescribes penalties and remedies for violations of the act. Used in conjunction with the Fair Credit Reporting Act (FCRA), the FDCPA becomes a very powerful credit repairing fighting tool.

Although a vast majority of debt collectors appear to abide by the guidelines of the FDCPA; a great many, however, will simply ignore the law and operate with complete disregard for the rights of the average consumer. For example, one consumer who had defaulted on her payments to a pay day loan outfit (well-known for charging ridiculously high interest charges) was threatened with imprisonment. In fact, they suggested to her that if she didn't pay immediately, that she would be picked up the next day by the authorities and thrown in jail. Let’s get something straight: “You cannot go to jail for failure to pay an unsecured debt!” Now that that’s out the way, let’s review what you’re indeed liable for. There’s only two ways to make a debt truly go away: 1) Either you pay it in full; or even better 2) You discharge it through a Chapter 7 bankruptcy filing. Buyers beware! A lot of consumer should be aware that any debt collector that offers you to settle a debt, should tread with a bit of caution. The reason: If you were to settle the account (i.e., make partial payment), this not only resets the statute of limitation, making you liable for a judgment, but it also can cause the debt to reappear at some later date under the guise of another collection company.

Conversely, a debt collector’s worst nightmare is a well-informed consumer who knows his or her consumer credit rights under the FDCPA. Again when used in conjunction with the FCRA, which is an actual federal law that regulates the collection, dissemination, and use of consumer information, the FDCPA can get most third parties debt organizations (i.e., collection agencies, debt buyers, junk debt buyers, etc.) to back-off a bit, allowing consumers—in absolute terms—to realize a small measure of self-empowerment. Knowledge is power. This especially holds true in the game of debt collection, as its truly up to the individual consumer in how much they will tolerate being in the dark about subject matters of importance to their personal finances. In addition, consumer credit laws were enacted for a very specific reason—namely, they were born out of pure necessity than anything else.

•Use repeated phone calls to harass you

•Use obscene or profane language

•Threaten you with harm or violence

•Threaten to take your property without legal recourse

•Falsely claim you have committed a crime

•Misrepresent the amount you owe

• Indicate documents are legal when they are not

• Falsely claim they are an attorney

• Falsely claim they are a government representative

• Oppress, harass or abuse you

• Try to collect interest or other additional fees unless it is expressly stated in the original contract and allowed by state laws

Unbeknownst to many consumers, debt collectors typically have a window of about 12 hours to call you about an unpaid debt. Typically, this 12 hour period must fall between 8:00 am and 9:00 pm local time. The only exception to the rule would be if you made arrangements for the bill collector to call back at a certain time outside of these hours.

In complete deference to the FDCPA, a debt collector may not employ abusive, unfair or deceptive tactics when attempting to collect an unsecured debt. This protection applies to any individual company, collection agencies, lawyers or law firms that purchase delinquent unsecured debts and then attempt to collect on them.