Nuts And Bolts Of The Fair Debt Collection Practices Act
Jason B. Thompson
Do you owe an outstanding debt to a business? Alternatively, is your company trying to collect on a debt owed? If so, you should know that there is a right way and a wrong way to go about collecting the debt. The Fair Debt Collection Practices Act is a federal law. It outlines what information debt collectors can gather on an individual and contains specific rules on how debt collectors can communicate with an individual at home or at work. The following is a summary of the law:
Debt collectors cannot communicate with a 3rd-party that an individual owes a debt. A debt collector can only call a 3rd party to verify location information on the individual. It is illegal for the 3rd party to communicate or imply that the individual is in debt.
There are set times in which a debt collector may call. An individual cannot be contacted before 8a.m. or after 9p.m. A debt collector can neither use any verbal threats nor obscene, profane, or abusive language with the individual. Further, the debt collector cannot make repeated calls to the individual.
It is prohibited for the company collecting a debt to threaten arrest, imprisonment, seizure of funds or property through garnishment or wage attachment and/or the sale of an individual's personal property.
Within 5 days of the initial contact, a debt collector must provide an individual with specific information and documents including a description of an individual's right to dispute the debt.
If the debt collector does file a lawsuit against an individual, then the lawsuit must be filed in the jurisdiction where the property is located, the contract was executed, or where the individual resides.
Debt collectors cannot use forms that appear to be from a court, police, state, or federal agency for the purposes of tricking an individual.
A debt collector who fails to abide by this law can be personally sued for damages ranging from $1,000.00 to $500,000.00.