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What Is The FDCPA?
Written by Jonathan Summers   
Thursday, 11 March 2010 08:31
In order to do battle with the problems associated with harassing debt collectors and debt collection companies, the Fair Debt Collection Practices Act (also known as the FDCPA) was designed. The laws and regulations legislated by the Fair Debt Collection Practices Act not only shield consumers, but they also aid debt collection agencies as well by encouraging them to operate in a serious and professional manner when engaging in communication with supposed debtors.
by JonathanSummers


In order to do battle with the problems associated with harassing debt collectors and debt collection companies, the Fair Debt Collection Practices Act (also known as the FDCPA) was designed. The laws and regulations legislated by the Fair Debt Collection Practices Act not only shield consumers, but they also aid debt collection agencies as well by encouraging them to operate in a serious and professional manner when engaging in communication with supposed debtors.

In most situations lenders are within their rights to pursue payment. This includes situations where the borrower is delinquent in their responsibilities and then consequently default on their financial obligations, and or if the borrower simply needs a little more time due to crude financial circumstances and strain. These above situations represent instances in which the lender is not acquiring his due payments from the borrower when they began with a reasonable expectation of being paid back in an adequate time frame. No matter the reason in these cases, the lender in question is legally within their rights to seek payment that they are due.

In these situations, the majority of the time lenders have no other alternative but to become involved with a collection agency. The goal of collection agencies is to recover and collect all of the monies that are unsettled to their clients (the lenders). Due to the Fair Debt Collection Practices Act, collection companies can no longer act rashly and with disinterest for the consequences of their actions when making an effort to recover monies for their clients.There are several clauses that come along with the Fair Debt Collection Practices Act as enacted in 1978. These clauses both protect debtors and enable collection companies to strongly pursue valid debts.

Even if a debtor advises a collections representative to terminate all further contact with him there are other means by which a debt collection representative may aim for the valid debt. For example, under the FDCPA, while the collection rep must agree with the debtors request to cease any further contact with them, they are also perfectly within their rights to make the debtor aware that they intend to pursue the debt via legal channels through an attorney.

If the collection agency responsible for recovering the delinquent account cannot communicate with or cannot reach the debtor, then they are legally allowed to contact third parties related to the debtor. However, under the FDCPA there are some boundaries to contacting third parties. First and foremost, the collection rep cannot harass the third party or be non-courteous. Also importantly, the collection rep cannot violate the right of privacy of the debtor by disclosing the nature of the call to this third party.

Among protocols for collection agencies to abide by, the Fair Debt Collection Practices Act also has a penalization system in place for those collection companies that do not abide by the aforementioned stipulations. These penalties against collection agencies found to be in violation of the FDCPA include: fines; license revocation; and even legal actions.

At first glance it appears as though the guidelines of the Fair Debt Collection Practices Act are strongly skewed toward the debtor. However, these rules also protect the debt collection agency by helping them steer to wards fair practices and policies in a courteous and professional manner. Without the FDCPA, the unprofessional behaviors of some select few collection agencies would go unchecked and thus would undermine the entire reputation of the business of debt collection.

About the Author:

Mallory McGuinness is employed by a collections agency that works with a debt collection lawyer. She also writes articles on business and finance, consumer spending and collections agencies.
 
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