What Can Debt Collectors Legally Do Under the FDCPA?

What Debt Collectors Are Allowed to Do#

Under the Fair Debt Collection Practices Act, debt collectors are allowed to contact a debtor about a debt, but they must follow specific rules about when, how, and what they can say. A debt collector may not contact a debtor at inconvenient times or places, such as before 8 a.m. or after 9 p.m., unless the debtor allows it.

What Debt Collectors May Not Do#

The Fair Debt Collection Practices Act lists specific practices that debt collectors are prohibited from using. Cambridge Credit Counseling summarizes several of these prohibited practices below.

More Rules Collectors Must Follow#

The Fair Debt Collection Practices Act regulates professional, third-party collection businesses, agents and attorneys, but not in-house collectors, or employees of creditors who collect their own debts.

• A collector may contact debtors in person, by mail, telephone, telegram, or fax. A debt collector may not contact a debtor’s workplace if the collector knows that the debtor’s employer doesn’t allow personal calls.
• The collector must contact the debtor directly unless the collector is informed that they must contact the debtor’s attorney regarding the debt. The collector may also contact other people, but only to find out where the debtor lives, what their phone number is, and where they work. Collectors are usually allowed to contact third parties only once, unless they believe that the person gave incorrect or incomplete information.
• Debt collectors may not harass, oppress, or abuse debtors or any third parties they contact, for example by making continuous telephone calls.
• Debt collectors may not use any false or misleading statements when collecting a debt, such as implying that they are attorneys or government representatives when they are not, implying that the debtor has committed a crime, falsely representing that they operate or work for a credit bureau, misrepresenting the amount of the debt owed, or indicating that papers being sent are legal forms when they are not, or are not legal forms when they are.
• Collectors cannot state that a debtor will be arrested if they do not pay the debt, or that they will seize, garnish, attach, or sell property or wages, unless the collection agency or creditor intends to do so and it is legal to do so.
• Debt collectors are also prohibited from giving false credit information about the debtor to anyone, including a credit bureau, sending the debtor anything that looks like an official document from a court or government agency when it is not, and using a false name.

How to Make a Collector Stop Contacting You#

Under the Fair Debt Collection Practices Act, a debtor can stop a collector from contacting them by writing to the collection agency. Cambridge Credit Counseling points out that sending this kind of letter does not erase a debt that is actually owed, so the underlying obligation remains even after contact stops.

Once the collector receives the letter, they may not contact the debtor again except to say there will be no further contact or to notify them that some specific action may be taken. The debt collector or the debtor’s original creditor may still have the right to sue the debtor.

A Note About Old Debts#

Statutes of limitations on debt vary by state. Making a payment of any size on a debt that has passed the statute of limitations can re-age the debt and restart the clock, so it is worth understanding your state’s rules before making a payment on an old account.

Where to Complain About a Collector#

A consumer who believes a bill collector has violated the Fair Debt Collection Practices Act can contact their state Attorney General office or the Federal Trade Commission, according to Cambridge Credit Counseling.

Many states have their own debt collection laws, and their Attorney General’s office can help consumers determine their rights.

Your Right to Take Legal Action#

If a debt collector violates the Fair Debt Collection Practices Act, the debtor has the right to pursue legal action against the collector in a state or federal court within one year from the date the law was violated. If the debtor wins, they may recover money for the damages suffered plus an additional amount up to $1000. Court costs and attorney’s fees also can be recovered. A group of people also may sue a collector and recover money for damages up to $500,000, or 1% of the collector’s net worth, whichever is less.

What to Do Next#

If collection calls have you feeling overwhelmed, Cambridge Credit Counseling’s process begins with a counselor reviewing your financial situation and the debts you want included, then providing an estimated monthly payment and how long it may take to become debt free. The Consumer Financial Protection Bureau also publishes guidance on the difference between credit counseling, debt settlement, debt consolidation, and credit repair, which can help you compare your options before deciding on a next step.