Friday, March 22, 2019

Eagle Butte

THE CREDIT CORNER: The FDCA and FCRA Debt Collection

Debt collectors. The very words can make us angry and fearful. And shady collectors, who don’t care about rules or how they treat debtors as long as they get paid, take advantage of this fear, using threats and intimidation to get their way.

Most legitimate collectors do not operate that way and will try to work with debtors.

Fortunately, for those who don’t, there are two sets of federal laws, the Fair Debt Collection Act and the Fair Credit Reporting Act, that will hold them accountable.

If you’re contacted about a debt and you either don’t owe the debt or have already paid it, the Fair Debt Collection Act (FDCA) provides protection against further collection activity once you make known the circumstances.

Under the FDCA, if you’re contacted about a legitimate debt, collectors must, upon request, provide written proof of the debt, the amount owed, and to whom it’s owed within thirty days of the request.

If you don’t want any further contact about a legitimate debt, you can advise them of that in writing and they must comply.

It doesn’t mean you no longer owe the debt, nor does it stop collection efforts (court filing, wage garnishment, etc.), but it does prevent the collector from making any further direct contact. Under the FDCA, collectors cannot harass, threaten, or intimidate debtors in any way.

The FDCA also prevents the collector from contacting your relatives, friends, employer, co-workers, neighbors, etc., regarding your debt and/or to obtain information about you. This has become especially important in the modern digital age, when social media and information databases make it easier than ever to find and contact anyone connected to you even if you don’t actually know them or it’s been years since you’ve had any contact with them. 

I’ve been contacted by collectors looking for exes as well as collectors looking for the exes of family members, which is not that unusual these days.

The Fair Credit Reporting Act (FCRA) regulates how your credit and debt information is reported, what types of information may be reported and for how long, and what information may be disputed and how. Under the FCRA, a debt may be listed on a credit report for no longer than seven years after the date the debt originated. 

Creditors may try to get around this by selling the debt to a debt-buying company, which may then try to “reset” the clock by listing the debt under its own name and not that of the original creditor. The FCRA frowns on this, however, and allows these “resettings” to be disputed.

These are just the very basics of both of these federal acts. You can google them and read them in full. Any violations of these acts may be reported to the federal agency responsible for enforcing them, which is the Federal Trade Commission, found at