How the FDCPA Protects Consumers
The Fair Debt Collection Practices Act (FDCPA) spells out exactly what can and cannot be done by a debt collector when they are trying to collect on an account.
It is important to note that the FDCPA only applies to debt collectors or collection agencies. For example: You have a Chase Bank credit card and you are receiving letters and calls from Chase trying to get you to pay your credit card bill, they don’t have to abide by the guidelines set forth in the FDCPA.
On the other hand, take that same Chase credit card account but the original creditor (OC) – Chase Bank in this case – charges it off as bad debt and sells it to a collection agency such as Resurgent Capital Services. Chase could no longer come after you for the debt while Resurgent could, but they WOULD have to abide by the FDCPA. In addition, any attorneys hired by a collection agency would have to follow FDCPA guidelines as well.
What Constitutes a FDCPA Violation?
Several acts constitute an FDCPA violation, most of them dealing with what collection agencies can and cannot say to try to entice you to pay them. The major things a debt collector cannot do include:
- Threatening you or using offensive language
- Telling you they will take your property or seize your bank accounts
- Make repeated calls where they just hang up or there is dead air over the phone
- Send you postcards about your debt
- Calling you between 8pm and 9am your time, or any other time you deem inconvenient
- Talking to someone other than you, your attorney, or a credit bureau about your debt (some limited exclusions apply)
The act also prohibits debt collectors from threatening to sue you if they have no intention to do so. For example, if they have never filed suit against anyone in the past, or only for very large amounts while you hold a very small amount of debt with them.
Additional fees cannot be tacked onto a debt either unless it specifically says they can be in your original contract.
Proving an FDCPA Violation
One of the most frequent violations involves having a debt collector call you more than 2-3 times a week and if you answer, you hear nothing but silence. In the same vein, if you have already revoked consent for a debt collector to call you and they call anyway, you likely have a valid claim under the Telephone Consumer Protection Act (TCPA).
In either case, you will probably have records through your phone company showing that they called. If you do not answer the phone, they may not show up on phone company records, but you can still take a screenshot of the missed calls on your cell phone to save as evidence.
Save every letter you receive or other piece of communication you have with a debt collector just in case they do commit a violation. Some of them are very easy to prove, others may take some work.
Telephone Calls Under the FDCPA and Other State Laws
While threatening language and other egregious violations regarding conduct have dropped considerably in the past decade, they will still pop up from time to time. Collection agencies keep records and recordings of every phone call.
Try telling a collection agency caller that you do not consent to being recorded, or that you are recording the phone call yourself. In either case, they will almost immediately hang up without saying another word. They use those recordings to protect themselves and it they can’t record you, they typically will not talk to you.
If they know you are recording them, they know that you would be using the recording to protect yourself, which leads to the callers’ employer to make it mandatory to either hang up or refuse consent to record the call. Living in a one-party consent state for telephone recording while the debt collector is also in a one-party state means you can record them without saying you are doing so.
During a lawsuit, your attorney can subpoena the telephone recording from the debt collector. Many times, a collection agency will say that they deleted that particular recording, but judges understand there is no reason an agency would do that unless there was something incriminating.
Often, a debt collector will go back and listen to their recording when they learn about the lawsuit or arbitration order. If they hear a clear cut violation, they are usually willing to cut a deal for an award without having to spend any money on legal fees.
FDCPA Statute of Limitations
There have been multiple court decisions that try to answer the question of when the clock starts on the statute of limitations for an FDCPA violation. In general, the statute is 365 days from the day of the violation, provided that the consumer knows about the event – not necessarily that it is a violation – that caused the violation.
For example, a debt collector calls a consumer and tells them to either pay their bill today or they are going to call the police and get them arrested. The consumer has 365 days from the day of the call to make a claim under the FDCPA. Even if the consumer did not know what the collector said was a violation, they learned of the event as it happened.
In another example, a collection agency receives a debt from a creditor and adds a $300 “collection fee” to the amount you owe. They then report this as your total amount owed to a credit reporting bureau and essentially “park” the debt, hoping you will need to get a loan at some point in the future and quickly call them and pay. 14 months pass and you pull your credit report discovering that they have added $300 to your original balance. The day you discover that violation is the day the clock starts running on the 365 day statute of limitations.
Awards for FDCPA Violations
Currently, you can receive $1,000 per violation, plus any actual damages you suffered because of it. In addition, your lawyer can recover reasonable fees from the other party, which often leads to these situations ending in a settlement.
The debt collector will often offer you a deal erasing your debt or possibly even doing that and giving you money.
How to Get Paid for an FDCPA Violation
While it would be nice to be able to write the debt collector a letter telling them to pay you $1,000 for an FDCPA violation, it probably will not work quite so easily.
If you are dealing with a collection agency trying to collect a debt stemming from a contract with an arbitration clause, that can often be your best bet to get paid. Electing binding arbitration and paying your fee will usually get the collection agency to the negotiating table. Sometimes, the debt collector will ignore you in an attempt to not have to pay you or pay the arbitration fee.
You may need to file a lawsuit in order to get anywhere. If you want less than the small claims limit for your county or state, you can start with a small claims court filing. It probably will not cost you more than $150 and it will absolutely get the debt collector’s attention. If they’ve avoided you for this long, they probably know what your next move will be and will negotiate with you before you file a federal suit.
Filing a federal suit should only be done if your small claims or other lawsuit is dismissed because of the wrong venue. You can try doing all of this pro se (by yourself) if you would like, but having an attorney would make things much easier at this point. Unless the event is a borderline violation, you will most likely not have to file in federal court.
If it gets to this point and you are representing yourself, your best strategy is to try making a deal with the debt collector’s lawyer before the hearing starts. Asking for a trade line removal from your credit report should be one of the first things you demand, then go from there in regards to either wiping out your debt or having them pay you money. This may not work but it is certainly worth a shot. If it doesn’t, either file a motion to compel arbitration (if there is an arbitration clause in your original contract) or file a continuance so that you can get a consumer attorney to take your case. The relaxed rules in an arbitration favor you while it is almost necessary for an attorney to take over if you are going to continue with the court case.