About the FDCPA
FDCPA stands for the Fair Debt Collection Practices Act and was a landmark federal law that was passed into law over 30 years ago in 1978. The legislation is found within the Consumer Credit Protection Act under Title VIII. The ruling was passed for the following purposes:
- to protect the consumer from harassment and unfair collection activities
- to eliminate debt collection practices that are abusive and coercive
- to promote the collection of debts in a fair manner
- to provide the consumer with an avenue for disputing incorrect debt information as well as obtaining valid information
The FDCPA has established specific guidelines for the proper ways in which a debt collector is allowed to conduct their business. Consumer’s rights involving the collection of debts are clearly defined under this legislation as well as prescribing penalties and/or remedies for those who violate the act. Additionally, the FDCPA is oftentimes used along with the Fair Credit Reporting Act (FCRA).
Who is covered by the FDCPA?
According to the FDCPA as well as various government and legal sources, a debt collector is broadly defined as “any person who uses any instrumentality of interstate commerce or the mails in any business the principal purpose of which is the collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed or due or asserted to be owed or due another” (see Wikipedia – http://en.wikipedia.org/wiki/FDCPA).
Although the law typically applies to those entities that are 3rd party debt collectors (not the original creditor), several states (e.g. California) offer state sanctioned consumer protection legislation that mirror the guidelines of the FDCPA. In addition to this, the law regulates the original creditors as well. The courts have also found that “debt buyers” fall under the act’s guidelines despite being involved in the collection of their own debts.
Another aspect about the FDCPA is that it clearly defines what a “consumer” and a “debt” are. It should be noted that the act’s coverage is restricted to family, household, and/or personal transactions. Conversely, if the debts are owed by businesses, or those business purposes of the involved individuals, they are not subjected to the guidelines of the law. Interestingly enough, the coverage and definitions that are contained within the FDCPA legislation have changed over time especially since the Financial Services Regulatory Relief Act was passed over 3 years ago in October of 2006.
Consumer rights protected by the FDCPA
Under the guidelines of the FDCPA, you as a consumer are allowed certain rights which include the following:
- you are allowed to have any invalid or time-lapsed information removed from your credit report
- you are allowed to rectify errors and inaccurate personal information contained on your credit report
- you can completely zero out and/or reduce interest payments
- you are allowed to combine any current loans into a single plan and make only one single monthly payment if you choose to do so
- you are allowed to combine current loan payments so that you are able to clear up debts
- you are allowed to reduce any future late payment charges
Just remember that there are always fine lines drawn between what is allowable and legal regardless of which side of the debt collection process we are discussing. This is the primary reason that you should consider hiring the services of an experienced and qualified FDCPA attorney.
For over 25 years, Jonathan Ginsberg has represented honest, hardworking men and women facing financial troubles.
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