FDCPA – Your Consumer Bill of Rights

 

Debt collection phone calls…this is one of the top reasons people file for bankruptcy – so that they can avoid having to deal with debt collectors and all the garbage that goes with it.  The thing is, you shouldn’t have to file for bankruptcy to get debt collectors to simply follow the law.  Just because you have fallen behind on your bills doesn’t mean that a debt collector has free rein to do and say what they want.  You can take control of the debt collection process while you work out a solution to your debt problem.

The law recognizes that that there is a power imbalance between consumers and debt collectors.  And too often people just accept the abuse because they somehow feel they “deserve it” simply because they have fallen behind on their bills.  To remedy this imbalance and put the parties on a level playing field congress passed the Fair Debt Collection Practices Act, usually know as the FDCPA.

The Need for a Consumer Bill of Rights

The FDCPA was enacted for four reasons:

• Jobs:  when debt collectors go unchecked, bad things can happen.  This is particularly true if a debt collector is harassing you while you are at work – and they love to do this.  Why?  Because it causes you pain.  Debt collectors know that it is embarrassing for your co-workers or boss to know that you are behind on your bills and that you will likely do anything you can to avoid that embarrassment.  If a debt collector can get away with calling you at work they will.  Those who enacted the FDCPA understood this and put regulations in place to protect people from losing their jobs due to unceasing harassment by debt collectors while you are at work.
• Marriage:  stress from financial issues is one of the leading causes of divorce.  Add abusive debt collection on top of that and things can be pushed to the breaking point.  The FDCPA regulates the types of contact that debt collectors can have with you and thus can reduce some of the stress associated with debt, which in turn can help keep the peace at home.
• Bankruptcy: I mentioned at the beginning of this article that many people file for bankruptcy just to get the debt collection phone calls to stop.  The thing is, many times bankruptcy is not necessary.  One of the main goals of the FDCPA was to stop unnecessary bankruptcy filings.  If the only reason you are thinking of filing for bankruptcy is because you can’t take the unending collection calls or because you can’t take another yelling, profanity-laced call from a debt collector, you should look at your rights under the FDCPA.  Bankruptcy may not be necessary.
• Privacy:  I have heard collection calls where a debt collector tells a consumer that they are waiting outside their home and if the debt isn’t paid they will be coming in with the sheriff to arrest them.  These were total lies, but really terrified the person on the receiving end of the call.  The FDCPA recognizes that you have a right to privacy and puts a clamp down on the unethical and invasive tactics that some collectors employ in trying to get payment.

What is Required to Bring an FDCPA Claim?

There are four criteria to bring an FDCPA claim against an abusive debt collector:

• Consumer:  It might seem obvious that you have to a consumer (i.e. you) but what may not be so obvious is that anyone who has been affected by the actions of an abusive debt collectors has standing to sue.  This means that if a debt collector is calling and harassing a family member of yours who doesn’t even owe on the debt, that family member may have a claim under the FDCPA.  Anyone impacted by a violation can sue the debt collector whether they are liable on the debt or not.
• Consumer Debt:  This one is important.  The FDCPA only deals with consumer debts.  These are debts that were incurred for personal or household reasons that are now in default.  The FDCPA does not apply to business debts.  This means that if you have a personal or family credit card that was used to purchase things like household goods, vacations, groceries, etc. then it is likely a consumer debt and would be under the FDCPA.  However if you have a credit card that is used for your business and the debts on that card are for things like inventory, fuel, or any business related expense, the FDCPA may not be applicable.
• Debt Collector:  The FDCPA does not apply to everyone or every company that is trying to collect on a debt.  Notably, the FDCPA does not apply to original creditors.  This means if Wells Fargo is calling you to try and collect on a debt that you owe to them, you likely won’t have any protections under the FDCPA.  However, if Wells Fargo sells the debt to Midland Funding you will have a claim if Midland Funding violates the FDCPA.
• Violation of the FDCPA:  Debt  collectors have every right to try and collect a debt so long as they follows the rules.  If they disregard the regulations put in place by the FDCPA you have a claim and can sue them.

What Type of Conduct Violates the FDCPA?

The list of do’s and don’ts of debt collection under the FDCPA is lengthy.  I will save the complete list for a different article.  But really there are four tests when it comes to determining if a debt collector has violated the FDCPA-

Was the debt collection conduct…

• Unfair?
• Untrue?
• Undignified?
• Disrespectful?

If the answer to any of those four question is “yes” then you may have a claim under the FDCPA.

What Would I Be Gaining by Filing an FDCPA Lawsuit?

The first thing you can accomplish by filing and FDCPA lawsuit is getting the debt collector to stop the abusive conduct.  You don’t have to put up with debt collectors lying, yelling, swearing, or any of the other garbage that does on.  If you file suit this behavior will stop.

Second, the FDCPA allows you to collect statutory damages of $1,000 (if you are in Arizona you can seek $1,000 against each debt collector that violates the law).

Third, you can ask the court to award you actual damages.  Actual damages in include compensating you for things like job loss, emotional damages, damage to your family relationships, etc.

Fourth, the FDCPA allows you to recover your attorney’s fees and costs.  Most consumer attorneys like myself will take FDCPA cases for no money up front and only collect a fee if we win the case.  If you lose, you pay nothing.

Don’t Take the Abuse

The point of this article?  Don’t take the abuse that debt collectors dish out. Debt collectors can treat you in a civil and dignified manner and follow the regulations of the FDCPA.  If they don’t?  Sue them.