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  1. Bankruptcy Glossary
  2. Fair Debt Collection Practices Act

What is the Fair Debt Collection Practices Act?

The Fair Debt Collection Practices Act (FDCPA), which is enforced the U.S. Federal Trade Commission, began in 1978 to prohibit abusive, unfair or deceptive practices to collect on debts.

FDCPA Consumer rights

Rightsrelated to debts protected by Fair Debt Collection Practices Act.

Consumers who are overwhelmed by debts and facing bankruptcy often have to contend with numerous telephone calls and other practices by bill collectors to generate payments on their bills. While attempts by creditors to collect on money they are owed is legitimate, some collectors resort to bullying techniques to get their payments.

"A debt collector may not contact you at inconvenient times or places, such as before 8 in the morning or after 9 at night, unless you agree to it," according to a Federal Trade Commission guidebook on the FDCPA. "And collectors may not contact you at work if they're told orally or in writing that you're not allowed to get calls there."

According to the FDCPA, a collector must stop communicating with a debtor if that person has told them in writing to stop. The only exception is notice from the creditor that the collection effort has ended.

Once a collector knows that a bankruptcy lawyer has been hired to represent the debtor, all contact regarding the unpaid bill must be with the attorney unless he agrees to allow communication to continue with the client.

The federal regulation has enforcement power over collection agencies, lawyers who collect debts and companies that buy delinquent bills and then begin to collect on them. It applies to personal, family or household debts rather than corporate or business debt.

The FDCPA prohibits collectors from threatening consumers with arrest or legal action that isn't warranted, garnishment of their wages or seizing property unless they are allowed to by law. They also cannot publish the names of people who are not paying their debts, although they may provide this information to credit reporting bureaus.

Collectors also may not make false claims, such as changing the amount of money that is owed by adding fees or interest, misrepresenting themselves, sending documents that appear to be from a court or government agency or giving false credit information about the debtor to anyone including credit reporting bureaus.

The FDCPA also provides debtors with an avenue for disputing bills and gaining debt information they need to make sure it is accurate. Its focus on consumer rights regarding debt collection frequently dovetails with the purview of the Fair Credit Reporting Act.