What is the Fair Debt Collection Practices Act (FDCPA)?
The Fair Debt Collection Practices Act (FDCPA) is a federal law that protects consumers from dishonest and abusive debt collectors. The law prohibits third-party debt collectors, such as debt buyers and collection agencies, from engaging in a wide range of bad practices, from misleading consumers to using abusive language or harassment. The FDCPA does not apply to original creditors, such as your automobile finance company or credit card issuer, and does not apply to business debts.
Who is a Debt Collector under the FDCPA?
Any individual or company in the regular business of collecting debts owed to another person or entity is considered a debt collector under the FDCPA. This includes companies that purchase delinquent debt (debt buyers) as well as collection agencies and even attorneys who regularly collect debts on behalf of their clients.
How Do I Know if a Debt Collector is Violating the FDCPA?
The FDCPA contains a very long and detailed list of prohibited actions. Rather than try to memorize them all, use this as a guideline so that you’ll recognize debt collector red flags and know to investigate further or talk to an FDCPA attorney:
- Debt collectors can’t swear at you or use vulgar or abusive language
- Debt collectors can’t threaten to do things they can’t or won’t really do, so if a threat sound over the top, that’s a red flag
- Debt collectors can’t harass you, which includes calling you repeatedly if you’re already spoken to them
- Debt collectors can’t tell other people about your debts, or threaten to do so
When in doubt, check in with an FDCPA attorney.
Can a Debt Collector Seize My Bank Account or Other Property?
Generally, a debt collector can only attach bank accounts or other property with a court order. If there is no judgment against you, a debt collector generally cannot take this type of action against you. In fact, a debt collector who threatens to freeze your bank account or seize other property may be liable for a violation of the FDCPA.
What Happens if a Debt Collector Violates the FDCPA?
You may be able to sue the debt collector for damages. The FDCPA includes a “statutory damages” provision, which means that you may be entitled to up to $1,000 without having to prove actual damages. If the debt collector’s misconduct has actually caused you harm, the award could be much higher.
What if I Can’t Afford an FDCPA Attorney?
The legislature didn’t want money to be a barrier for consumers whose rights have been violated. Therefore, the FDCPA provides for attorney fees. That means that if the debt collector is found to have violated your rights, the company must pay your attorney fees and court costs in addition to any damages award. Generally, you won’t pay anything in advance, and the law firm will get paid when the debt collector pays the attorney fees under a court order or settlement agreement.
Can a Debt Collector Call My Friends and Family?
Generally, debt collectors are not allowed to contact your friends, family, neighbors, employer, or other third parties, but there is one exception. A debt collector may contact outsiders to attempt to obtain contact information for you. In other words, if the debt collector has your address and phone number and has been in contact with you, then contacting other people violates the FDCPA.
When debt collectors do contact third parties such as friends and relatives, they are not allowed to share information about your debt, or even tell them that you owe a debt. If a debt collector has disclosed information about your debt to a third party or is contacting your friends and family even though they know how to reach you, schedule a free consultation—you may be entitled to compensation.
Can I Record a Phone Conversation with a Debt Collector?
Often, a recording of a conversation with a debt collector is exactly the evidence you need to prove your case. If the debt collector lies about your debt, threatens you, or uses profanity on the recording, that recording may become the deciding factor in your case. However, you must also comply with the law.
If a call is recorded illegally, the judge won’t listen to the recording. And, the person who made the illegal recording could be at risk, as well.
The law varies from state to state, so if you are considering recording a debt collector call, make sure that you know and understand the law in your state. For example, in many states you are required to advise the other person that you are recording the call. In those states, it is important that you not only tell the other party that you’re recording, but do so on the recording so that you can prove you did so.
What Damages am I Entitled to in an FDCPA Case?
The Fair Debt Collection Practices Act provides for two types of damages. Statutory damages are damages created by the law itself—you do not have to prove that you were actually harmed in order to receive statutory damages, just that the debt collector violated the law. The court may award statutory damages of up to $1,000.
In addition, you may be entitled to actual damages. Actual damages are harms you suffered because of the debt collector’s violation, and may include anything from job loss or damage to relationships as a result of the collector’s actions to psychological or medical harm triggered by debt collector harassment.
Can a Debt Collector Call Me at Work?
Yes, but there are limits. For example, a debt collector can’t call you at work if the collector knows that your employer objects. A debt collector also can’t call you repeatedly at work to harass you, and can’t disclose information about your debt to your boss or your co-workers.
Is it Legal for Debt Collectors to Call Me Over and Over Again?
That depends on you. If you have spoken with the debt collector and the collector has no legitimate purpose to call you back minutes or hours later, those additional calls may violate the FDCPA. However, a debt collector may generally place repeated calls in an effort to reach you, if they have been unable to make contact. Picking up the phone and telling the collector where things stand financially should put an end to the constant calls. If it doesn’t, you may have an FDCPA claim.
In some circumstances, calls that are acceptable under the FDCPA may violate another consumer protection statute, the Telephone Consumer Protection Act (TCPA). The TCPA prohibits automated calls (also known as “robo calls” or “robo dialing”) to cell phones, unless the consumer has consented.
The TCPA also provides for damages, but does not provide for attorney fees. Therefore, a TCPA claim is generally not worth pursuing unless there have been a large number of calls, since attorney fees would exceed damages in a case involving one call or a handful of calls.
What if I Don’t Believe I Owe the Debt?
A debt collector is required to send you a written notice within 5 days of initial contact. That notice contains information about your debt, such as the creditor’s name and the amount of the debt. That notice must also advise you that you have the right to dispute the debt within 30 days, and that if you do so, the debt collector will stop collection actions until the debt has been verified.
Sending a dispute letter is the first step if you believe that the debt isn’t yours, has already been paid, is in the wrong amount, or is otherwise not your responsibility. If a debt collector is calling you and you don’t receive this written notice, or if you dispute the debt and the debt collector continues collection efforts without verifying the debt, you may have an FDCPA claim and should schedule a free consultation.