FAQs About Debt Collection and the FDCPA

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FAQs About Debt Collection and the FDCPA

If I really do owe a debt collector money does that change the way they can treat me?
No. It does not matter if you owe the money. A debt collector must still follow the law in collecting a debt.

Who And what is covered by the Fair Debt Collection Practices Act (FDCPA)?
The FDCPA protects “consumers” against “debt collectors” for “consumer debts.” A “Consumer” is any person who owes or allegedly owes a consumer debt. A “Debt Collector” is any person or entity, other than the creditor, who regularly collects debts owed to others. This includes attorneys who regularly collect consumer debts.

A “Consumer Debt” is any debt that is primarily for personal, family, or household purposes. Common types of debts governed by the FDCPA are home mortgages, credit card, automobile loans, utility bills and medical expenses. However, “consumer debt” does not include other types of debts such as business debts, debts incurred for business purposes, alimony, child support or criminal fines.

How do I know if the FDCPA applies to the company trying to collect a debt from me?
A “Debt Collector” under the FDCPA is any company that you did not originally owe the money to. For example, it is not a hospital, credit card company or bank. A “debt collector” is any company hired to collect upon the money owed to the hospital, credit card company or bank. In addition, “debt collectors” also include companies that purchases a debt (“debt buyers”) from one of these entities.

What is prohibited by the FDCPA?
There are many things a debt collector cannot do to collect a debt by the FDCPA. While it would be impossible to list every violation, they generally fall into one or more of the following categories:

  • Contacting Third Parties
    Generally, a debt collector can contact a third person (anyone other than the consumer) one time to confirm or locate the consumer. They must identify themselves and indicate that they are  confirming or correcting location information. However, they cannot reveal, either directly or indirectly, that the consumer owes a debt.
  • Prohibited Communications Practices
    A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of a debt.
  • Harassment or Abuse
    A debt collector must treat you with respect and honor your requests about communication. They cannot verbally abuse or threaten you.
  • False or Misleading Representations in Communications
    A debt collector may not use or make any false statements when trying to collect a debt.
  • Unfair Practices
    A debt collector may not use any unfair or unconscionable means to collect or attempt to collect the alleged debt. In addition, they cannot attempt to collect any amount not authorized by the agreement creating the debt or permitted by law.
  • 30 Day Validation Notice
    A debt collector must send you a thirty (30) day validation notice within five (5) days of their initial communication with you.

What must a debt collector do after they first contact me?
Under the FDCPA, a debt collector, within five (5) days after first contacting you, must send you a written notice that contains, at least, the following information:

  • The amount of the debt;
  • The name of the creditor to whom the debt is owed;
  • Notice that unless you, within thirty (30) days after receipt of the written notice, dispute the validity of the debt, or any  portion of it, the debt will be assumed to be valid by the debt collector;
  • Notice that if you notify the debt collector, in writing, within thirty (30) days after receipt of the written notice, that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against you and a copy of such verification or judgment will be mailed to you;
  • Upon your written request within thirty (30) days after receipt of the written notice, the debt collector must provide you with the name and address of the original creditor, if different from the current creditor; and
  • Notice that the communication is from a debt collector attempting to collect a debt and that any information obtained will be used for that purpose.

What are permissible ways a debt collector may communicate with me?
Generally, a debt collector may communicate with you by mail, in person, by telephone or telegram. However, a debt collector cannot contact you at times or in places that they know are inconvenient to you. For example, they cannot contact you at work if they are aware, either because they know themselves or you tell them, that your employer does not permit personal call. Another example is that cannot contact you during daytime sleep hours if you work nights. Other impermissible contact include not before 8 a.m. or after 9 p.m or if you are represented by an attorney concerning a consumer debt.

A debt collector has a right to contact other people once, and only once, in an effort to locate you. However, they are not allowed to tell anyone but you and your attorney that you owe anyone else money.

If you send a written request to a debt collector demanding that they stop contacting you, the debt collector must stop contact immediately, but they are permitted to send one last communication advising you that they intend to take a specific action against you, such as filing a lawsuit to collect the debt.

When is a debt not valid?
Most debts will eventually expire unless legal action is initiated. If the debt is barred by your state’s statute of limitations, a debt collector cannot collect anything from you on the debt. Other debts may not be valid for other reasons such as the failure to provide the services agreed to. Identity theft would be another cause of an invalid debt.

What is a Statute of Limitation?
A statute of limitations is a period of time in which to bring your claim, usually by filing a lawsuit. If you do not file the claim within the time period, unless an exception applies, the claim will be barred, that is, can not be collected upon. Statute of limitations are different in every state and, as noted, there are certain situations that may shorten or lengthen the time period to bring the claim. If you have a question about a statute of limitations you should contact an attorney.

What are the Statute of Limitations for debts?
There are no statute of limitations on certain types of debts such as Federal Student Loans; most criminal fines; past due child support and taxes. However, most other debts expire depending on the state’s law that governs the debt. In Nebraska, the statute of limitations on most debts is four (4) years for those based on an oral agreement and five (5) years for those based on a written contract or agreement. It can be difficult to determine exactly when a statute of limitation expires so it is advisable to contact an attorney to determine the exact statute of limitations on your particular debt.

What are “Mini-Miranda” Warnings under the FDCPA?
Under the FDCPA a debt collector is required to provide certain information in any communication with you. These are often called “Mini-Miranda” warnings.

In a telephone conversation, the debt collector must, in either these exact words or something very similiar, which conveys the same information:

“Hello, I am _________(name of collector). I work for name of debt collection company) who represents ____________(creditor). Information obtained during the course of this call will be used for the purpose of collecting the debt.”

In written communication, the debt collector must have the following, in either these exact words or something very similiar:

This is an attempt to collect a debt. Any information obtained will be used for that purpose. Unless within 30 days of your receipt of this notice, you notify us that you dispute the validity of this debt, it will be assumed to be correct. If you notify this office within thirty days that you dispute the validity of the debt, we will obtain verification of the debt or a copy of the judgment. If you request it within 30 days, we will provide you with the name and address of the original creditor (if different from the current creditor).

What do I get if I win my FDCPA case?
If you win your FDCPA case you may be entitled to:
1)     Up to $1,000.00 in statutory damages;
2)     Actual damages if you have been actually harmed by the debt collector’s wrongful actions;
3)     Your attorney fees paid for; and
4)    The litigation expenses incurred by your attorney;

If I win my FDCPA case does the debt go away?
Not necessarily. If the debt was not valid it should and the debt collector should stop trying to collect on it. If the debt is valid, you still owe the debt. The FDCPA attempts to regulate the methods a debt collector may use to collect a debt by “punishing” any debt collector for abusive, unfair, harassing or unlawful actions in trying to collect a debt. The Act is not intended to make a debt go away.

What governmental agencies regulate and enforce the FDCPA?
The primary governmental agencies are the Federal Trade Commission (FTC) and the newly created The Consumer Financial Protection Bureau. These agencies draft and implement regulations and advisory opinions regarding the FDCPA.

What should I do if debt collector calls?
You do not need to talk to the debt collector if you know you cannot pay. Do not answer the phone if you know it is a debt collector.  Do not answer any questions asked by the debt collector. Do not disclose private information about your assets or income.

Does Lapin Law Offices offer financial planning, money management, debt consolidation services, credit counseling or bankruptcy representation?
No. We limit our practice to representing clients against debt collectors and other companies for violations of the FDCPA, TCPA, FCRA and Nebraska law.

What should I do if I believe my rights have been violated under the FDCPA?
Contact Lapin Law Offices for a free consultation to learn more about your rights.