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How the Fair Debt Collection Practices Act Protects Debtors

The Fair Debt Collection Practices Act has been around in different forms for several decades, but is rarely well-known by the average consumer. While I won’t be covering each and every piece of information in the document, I do want to summarize some of the key sections.

If you are currently struggling with debt and have fallen behind, there is a large chance you are dealing with collectors on a regular basis. In this situation, it is vitally important that you have a firm grasp on your rights. Violations of these rights occur on a daily basis, fueled by the lack of knowledge from the average consumer.

I’m Current On My Debt. Why Should I Care?

Even if you aren’t struggling with debt, I’d be willing to bet there is someone in your life who is. Nothing gets my blood boiling more than stories about debt collectors taking advantage of people in desperate financial situations. If someone you care about finds themselves in this situation, you will be glad you have the information to help them!

Don’t get me wrong, I know for a fact that not all debt collectors are bad people. But like many groups, a few “bad apples” are causing the entire industry to spiral out of control. Ultimately, consumers should take responsibility in fulfilling obligations they knowingly enter into and receive benefit from. However, they should be able to do this without being subject to harassment or abuse.

Disclaimer: The information provided below is a general summary and should not be mistaken for a definitive list. If you feel like you have been the victim of harassment of any kind, please contact a local professional who can review the specifics of your situation. Any quoted text references this full-length PDF [3], which is publicly provided by the FTC.

To start, let’s take a look at Congress’ own reasons for addressing this issue.

They’ve outlined it remarkably well in the early parts of the act:

ยง 802. Congressional findings and declaration of purpose

  1. There is abundant evidence of the use of abusive, deceptive, and unfair debt collection practices by many debt collectors. Abusive debt collection practices contribute to the number of personal bankruptcies, to marital instability, to the loss of jobs, and to invasions of individual privacy.
  2. Existing laws and procedures for redressing these injuries are inadequate to protect consumers.
  3. Means other than misrepresentation or other abusive debt collection practices are available for the effective collection of debts.

I couldn’t agree more!

Now, onto some of the specifics…

How a collector should act when talking to anyone other than the person that actually owes the debt.

A collector should:

A collector should NOT:

How a collector should act when talking to anyone other than the person that actually owes the debt.

A collector should:

A collector should NOT:

List of prohibited practices that are considered harassment and/or abuse.

A collector should NOT:

List of prohibited practices that are considered false, deceptive, or misleading.

A collector should:

A collector should NOT:

List of additional prohibited practices that are considered unfair.

A collector should NOT:

Outline of “30 day” notices and initial obligations of the collector.

Within five days after the initial communication, a debt collector should provide the following information:

If a consumer (a) disputes the validity of any portion of the debt or (b) requests the original creditor’s name and address, the collector should cease collection of the debt until all the information requested is provided.

How collectors should handle single payments by consumers with multiple debts.

A collector should:

A collector should NOT:

In the event of a lawsuit, discusses where a collector should file suit.

A collector should:

Last, but not least…

No one plans to be in a situation where they are dealing daily with creditors. However, a large number of families find themselves in this situation. By familiarizing ourselves with our rights under the Fair Debt Collection Practices Act, we can minimize the financial hardship exacerbated by irresponsible and abusive collection techniques.