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How the Fair Debt Collection Practices Act Protects You

Updated on January 13, 2013
The Fair Debt Practices Act provides protection from abusive, aggressive and illegal debt collectors.
The Fair Debt Practices Act provides protection from abusive, aggressive and illegal debt collectors. | Source

What is the Fair Debt Collection Practices Act?

If you are a person who has skipped payments or even defaulted on a credit card, personal loan or student loan, you're probably having to deal with a collection agency.

If you have had any experience with debt collectors, you know that they can sometimes use unscrupulous methods to try and coax, scare or even threaten you to pay off an unsecured debt.

While most commercial debt collection agencies do operate within the law, some do not. The evidence of this is reflected in the large number of complaints against collection agencies every year.

In 2011, nearly 181,000 complaints were filed with the Federal Trade Commission by consumers against debt collectors.

It seems that a large number of consumers are still unaware that they have specific rights and protections against the collection activities of a bill collector. The thing to remember here is that a debt collection agency is a business and their business is collecting money.

They have bought your debt from the original creditor or from another collection agency for a fraction of the amount actually owed. It is to their advantage to try an collect as much as possible.


To What Lengths Will a Collection Agency Go to Collect a Debt?

There are some real-life horror stories about debt collection agencies that have stepped well beyond the legal and ethical boundaries when trying to collect money.

Some debt collectors completely ignore the Fair Debt Collection Practices Act and will do just about anything to collect an unsecured debt.
Some debt collectors completely ignore the Fair Debt Collection Practices Act and will do just about anything to collect an unsecured debt. | Source

For instance, one consumer who had defaulted on her payments for a cash advance loan from a national check cashing and loan chain was threatened with imprisonment. They told her that if she didn't pay immediately, she would be picked up the next day by the authorities and thrown in jail.

Debt collectors may use all sorts of illegal tactics to get a consumer to pay the money owed and other additional phony interest fees or additional surcharges. One collection agency falsely informed one consumer that he would be "legally prosecuted in just a couple of days" and that his "Social Security number would be put on hold by the U.S, Government."

Some of these bill collectors will threaten consumers with warrants, lawsuits or even prosecution if they fail to pay up immediately. Most people are so intimidated by these illegal strong-arm tactics that they simply give in and are forced to make payment arrangements they cannot afford.

What consumers need to know is that they have rights under the Fair Debt Collection Practices Act which limit the actions of a collection agency.


According to the FDCPA, Debt Collectors May NOT ...

• 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

• make false statements of any kind regarding your debt

Know Your Rights When Dealing With Debt Collectors

From my own personal experience, I know that bill collectors absolutely despise a consumer who is fully aware of the rights and protections afforded to them under the Fair Debt Collection Practices Act (FDCPA).

These laws have provided me with the backbone and courage needed to deal with some rather nasty little people who are trying anything to collect debts - even some debts which were not mine.

Knowledge is indeed power so gird yourself with the latest rights, laws and tactics to defend against the sometimes illegal, aggressive and bullying tactics employed by these unscrupulous rascals.

Now, let me be clear - I have handled many of my own and others debts through the years and not all debt collection agencies are bad, however, there are a good number who will literally try anything.

Take a look at the list to the left and you'll see just some of your rights.


A Collection Agency Must Abide by the Law

According to the Fair Debt Collection Practices Act, 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 debts and then attempt to collect them.

In spite of the laws protecting consumers, credit collectors may not work within the prescribed limitations of the Fair Debt Collection Practices Act.
In spite of the laws protecting consumers, credit collectors may not work within the prescribed limitations of the Fair Debt Collection Practices Act. | Source

The types of debts covered include money owed for a car loan, personal credit card, a medical bill or even your mortgage. Business debt or debt incurred for a business are not covered under the FDCPA.

Debt collectors may not call at any time of the day or night.

Typically, they must call between 8:00 am and 9:00 pm local time. The only exception would be if you made arrangements for the bill collector to cal, back at a certain time outside of these hours.

Every collection agency is required by law to send you a written validation notice within five days of first calling you. This validation notice lets you know how much money you owe. This letter will also contain information on the original creditor and will give you information on how to proceed in the case that you do not owe any money for this particular debt.

It is your right to stop the calls if you simply request it. The bill collector must stop contacting you after they receive your letter responding to their initial debt verification letter.

It's best to send your letter as Certified mail so you know when they sign for and receive your letter.


The collection agency may contact you again if it sends you a written verification of the debt. You may also send a letter respectfully demanding they do not call you anymore.

Debt collection agencies may not contact you at work if you simply tell them not to call you there or that you are not allowed to get calls at work. You can inform them by written letter or verbally over the phone - either way lets them know they cannot call you at that number.

Debt collectors are allowed to contact other people you know but only to get your address, phone number and place of employment - that's it.

As a matter of fact, a bill collector may not discuss your debt with anyone other than you, your attorney or your spouse.


Fair Debt Collection Practices Act: The Bottom Line

Know that debt collectors may do just about anything to collect money. While not all debt collection agencies approve of these unscrupulous actions and do not practice them, some of them will.

It is your responsibility to be informed and prepared to deal with any situation. You have specific rights. You need to know these rights. I suggest you look carefully at the actual Fair Credit Collection Practices Act on the U.S. Federal Trade Commission website.

The information in this article is intended for informational purposes only and not for the purpose of providing legal advice. You should contact your attorney, accountant or financial advisor to obtain advice with respect to any particular issue or problem.


What protections are not provided for consumers under the Fair Debt Collections Act?

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More Info on the Fair Debt Collections Protection Act


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