What Is the Fair Debt Collection Practices Act (FDCPA)?
The Fair Debt Collection Practices Act (FDCPA) is a federal law that restricts the actions of third-party debt collectors that are attempting to collect debts on behalf of another individual or entity. The legislation restricts the ways that collectors can contact debtors, in addition to the time of day and number of times that contact can be made. If the FDCPA is violated, the debtor can take legal action against the debt collection company in addition to the individual debt collector for damages and lawyer fees.
How the Fair Debt Collection Practices Act Works
The FDCPA does not protect debtors from those that are attempting to collect a personal debt. If you owe money to the local hardware store, for example, and the owner of the store calls you to collect that debt, that person is not a debt collector under the terms of this act. The FDCPA only applies to third-party debt collectors, such as those who work for a debt collection agency. Credit card debt, medical bills, student loans, mortgages, and various other kinds of household debt are covered by the law.
Example of When and How Debt Collectors Can Contact Debtors
The Fair Debt Collection Practices Act specifies that debt collectors can not contact debtors at bothersome times. That means they must not call before 8 a.m. or after 9 p.m. unless the debtor and the collector have made an arrangement for a call to happen outside of the permitted hours. If a debtor tells a collector that they wish to talk after work at 10 p.m., for instance, the collector is allowed to call then. Without an invitation or agreement, however, the debtor can not legally call at that time. Debt collectors may also send letters, emails, or text messages to collect a debt.
Debt collectors can try to reach debtors at their homes or offices. However, if a debtor asks a bill collector, either verbally or in writing, to quit calling their place of employment, the collector must not call that number again.
Within five days of contacting a debtor, the debt collector must send a written "validation notice" that includes:
- The amount of money the debtor owes
- The name of the creditor to whom the debt is owed
- Notice that they have 30 days to dispute the debt and what to do
Debtors can also prevent collectors from calling their home phones, but they have to put the request in a letter and send it to the debt collector. It's a good idea to send the letter by certified mail and pay for a return receipt so that you have evidence that the debt collector got the request.
If a collector does not have contact information for a debtor, they can call family members, neighbors, or associates of the debtor to try to find the debtor's contact number, however they can not disclose any information about the debt, including the fact that they are calling from a debt collection agency. (The collector may only talk about the debt with the debtor or their husband or wife.) Furthermore, collectors can only call third parties once each.
The legislation makes it illegal for debt collectors to bother debtors in various other ways, including threats of bodily harm or incarceration. They also can not lie or use profane or obscene language. In addition, debt collectors can not threaten to sue a debtor unless they really plan to take that debtor to court.