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Debt Collection practices Explained

People who are in debt must be aware of Fair Debt Collection Practices Act (FDCPA). If collection agencies are calling you or if creditors are harassing you, you will want to know your rights under this act to ensure that you are treated fairly and legally. This article includes the following:

  • Find more details on FDCPA
  • What comes under False and Misleading Tactics of FDCPA?
  • Learn more about Civil Liability for violations of FDCPA

White paper on file extraction process for debt collectionIf you are in debt, you need to know about the Fair Debt Collection Practices Act. The fair debt collection act is what you should refer to when you have questions about legal debt elimination or legal debt settlement. If collection agencies are calling you or if creditors are harassing you, you will want to know your rights under this act to ensure that you are treated fairly and legally. You should also refer to this act when you need to know about legal debt negotiation.

What is the FDCPA?

The Fair Debt Collection Practices Act (FDCPA) is a federal law that protects customers. It outlines what tactics collection agencies and creditors can use to get outstanding money and it expressly outlaws abuse and harassment as methods of collection. The act also reveals what sorts of personal data creditors and debt collection agencies can gather about customers and delineates the appropriate ways that creditors and collectors can communicate. The FDCPA also provides the grounds for legal action if a collector agency or creditor breaks the law.

What is the Act for?

The act is really created for customers and for collectors and creditors. By outlining exactly what creditors and collection agencies can do and how they can behave, the FDCPA helps creditors and collectors understand their roles and responsibilities. The FDCPA also protects customers from abuse, fraud, invasions of privacy, tricks, and harassment at the hands of creditors and collection agencies. Under the FDCPA, for example, a collection agency cannot lie to you and tell you that your debts will cause your child to be taken from you. They cannot trick you into paying your debts and they cannot harass you either. This helps ensure a professional and calm approach to outstanding debts and helps promote an environment where debts can be settled fairly.

Clauses of the FDCPA

The FDCPA is divided into clauses or chapters. Each has its special function or theme. To understand the FDCPA in full, you need to understand each clause.

  1. Chapter 3: Collection Terms and Definitions
    This part of the FDCPA explains the terms and definitions used throughout the act. This long section can help you understand the rest of the document.
  1. Chapter 4: 3rd Party Contact and Information Gathering Rules
    This clause determines what tactics collection agencies and collectors can use to get personal information about you. Specifically, this clause allows collectors to call a third party about you only once and only in order to get your address, your telephone number, and your place of work.
  2. Chapter 5: Collection Calls and Communication Rules
    Many customers see this part of the FDCPA as the most important, because it protects you from harassment and abusive communication. Under the rules set out in this part of the FDCPA, for example collectors cannot call you prior to 8 a.m. or after 9 p.m. This clause also stipulates that a collector can’t call you at work if your employer disapproves of such calls.
  3. Chapter 6: Harassment and Abusive Collection Tactics
    This clause protects customers from obscenities, fright tactics, abusive or offensive language, and threats. This clause also states that collectors cannot call too frequently in order to frighten a debtor into paying a debt.
  4. Chapter 7: False and Misleading Tactics
    Under this clause, collectors cannot threaten you or mislead you into paying a debt. They cannot threaten you with arrest, seizure of assets on unsecured loans, jail time, or garnishment of your wages. They also cannot misrepresent themselves, provide false data about the collector, claim that you owe money than you in fact owe, or trick you into picking up the phone or accepting a telegram.