If you’re currently struggling with debt, you’ve probably learned the hard way that debt collectors can be absolutely relentless. It’s literally their job to pester you into cutting them a check regardless of your circumstances.

The endless stream of phone calls, nasty letters, and threats can really put a damper on your daily life, but it’s important to know that there are laws that protect you, and you do have legal recourse if debt collectors are treating you inappropriately.

To understand the FDCPA, you’ll need to know who the regulations apply to, how the policies apply to debt collector communication, and what the law specifically prohibits.

What is the Fair Debt Collection Practices Act?

The Fair Debt Collection Practices Act (FDCPA) is a law that protects consumers from abusive debt collection practices. The law established clear regulations as it relates to how and when debt collectors can communicate with consumers, and also prohibits harassment or misleading practices.

Who does the FDCPA apply to?

The FDCPA specifically applies to third-party debt collectors only.

A third-party debt collector is an entity whose primary business purpose is to collect debts owed to another party. Oftentimes when a consumer defaults on a loan, the lender will contract an agency that specializes in debt collection to recover the funds. The debt collection agency is then paid a percentage of the amount they recoup.

For example, if you were to visit the emergency room with a broken arm and a month later you receive an astronomical bill that you didn’t make any payments on for several months, it’s not unusual for the hospital to contract with a debt collection agency to go after you for the outstanding balance, rather than the hospital using their time and resources to try to collect on their own.

This is an important distinction because FDCPA does not apply to the internal collection department of the agency who originally loaned the money or provided the service. That is to say that in the above scenario, if employees from the hospital’s internal billing department try to collect on the debt for your broken arm, they would not be subject to the regulations of the FDCPA.

How does FDCPA protect me?

The law focuses heavily on regulations as it relates to how and when debt collectors contact you or other parties regarding your debt.

Under the FDCPA debt collectors are not allowed to:

  • Contact you before 8 A.M. or after 9 P.M.
  • Disclose your debt to a third party like your employer, coworkers, neighbors, etc.
  • Call repeatedly to harass you.
  • Call you at work if you’ve informed them that you are not allowed to receive personal phone calls at your place of employment.
  • Send you a postcard or any parcel in the mail that openly displays the debt collector’s logo, or any language that pertains to debt collection.
  • Misrepresent their identity or claim to be law enforcement.

Additionally, you are able to stop collectors from calling you at all by writing a cease-and-desist letter. It’s advisable to send your letter via certified mail with a confirmation of receipt for your records in case they continue to call you.

You should also be on the lookout for these common debt collector scams that (frighteningly enough) aren’t all necessarily illegal, but definitely worth safeguarding against.

What if my identity was stolen?

With the popularity of online shopping, this is a situation that’s becoming more common every day. If your debt is a result of identity theft, you’ll need to send the collector a letter disputing their claim along with a copy of the police report regarding the fraudulent charges.

It’s important to act quickly, because if you fail to respond within the 30 day validation period, the agency will assume that the debt is valid.

What can I do if a debt collector violates FDCPA?

If you believe that a debt collector has violated the law, you are able to take legal action within 12 months of the alleged infraction. You may file a lawsuit on your own behalf, however it should also be noted that if you win your case you may be eligible to recover any attorney’s fees you’ve incurred as part of your lawsuit.

Judgments for FDCPA violations are generally up to $1,000 but if you can prove further damages at trial, you may be entitled to more.

If you aren’t looking to file a full blown lawsuit but would still like to hold the debt collector accountable for their violation you can also file a complaint with the Consumer Financial Protection Bureau.

A final word on FDCPA

Being in debt is difficult enough without having to deal with harassment. FDCPA is here to protect you and we encourage you to know your rights and stand up against any debt collector who infringes upon them!

You can also find more resources for dealing with debt collectors in our piece about how to negotiate debt settlement on your own.