Laws for Credit Collectors
Calls from credit collectors can be a little scary. You may not know what to say or whether to even answer your phone. The letters you receive may sound intimidating. You are, of course, obligated to pay back what you owe. You have the right to fair treatment as well, and laws exist to keep creditors from harassing you or your family and to protect your privacy.
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Fair Debt Collection Practices Act
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The Fair Debt Collection Practices Act, or FDCPA, was passed in 1978. The FDCPA -- a federal law -- applies to all third-party debt collectors. It doesn't apply to charitable organizations or companies doing their own in-house collections. In other words, if you owe money directly to a particular company, that company does not have to follow the FDCPA. If the company sells your debt to a collection company, the collection company does fall under the FDCPA.
FDCPA Regulations -- Call Times and Privacy
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The FDCPA restricts collectors to calling strictly between 8 a.m. and 9 p.m. The law also restricts who collectors can talk to and what they can say. Collectors can only call people who may know of your whereabouts and ask about your location. They cannot talk to anyone about your debt. The only exception is if you have a lawyer. In that case, the creditor must communicate with your lawyer and not to you. Collectors can't call you at an inconvenient place. If your workplace forbids collection or personal calls, and you tell the creditor this but they continue to call, it's a violation.
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FDCPA Regulations -- Harrassment
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Creditors can't use obscene or threatening language or scare tactics. They can't threaten to sue if they aren't planning to. They can't pose as someone else or use a fake company name. Creditors can't lie to collect the debt. They also can't send anything that looks like it came from the government. Creditors are required to send a letter within five days of first contacting you by phone explaining the debt and the amount. Collections agencies must also honor letters requesting no contact.
State Laws
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Many states have their own laws that may be more strict than the FDCPA. California, for example, expands laws for credit collectors to apply to creditors doing in-house collections as well as third-party debt collectors. Some states require licensing for creditors. You can also report violations of the FDCPA to your state's Attorney General office.
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