The debt collection industry is massive, amassing some $12 billion annually.
In spite of its size, it continues to overstep legal boundaries by harassing customers, employing abusive tactics, failing to verify debts owed and pursing debts that are no longer collectable.
Our Miami consumer rights attorneys know that you don't have to sit idly by and take it.
Older initiatives enacted by the Federal Trade Commission protect consumers, and those are being bolstered with more recent efforts by the newly-founded Consumer Financial Protection Bureau.
Whether a collector is a large financial institution, the original lender or a third-party debt collection firm, the same rules apply. Previously, the CFPB would only accept complaints from consumers regarding collection of credit card debt. However, in the last several weeks, the agency has moved to expand the complaint process to cover all kinds of consumer debts, including student loans, medical bills and past-due automobile payments.
Once complaints are made to the agency, the collection firm has 15 days during which to respond. The CFPB will decide from there whether a violation has occurred (or whether a pattern of violations are occurring) and what kinds of sanctions should be enacted in that case.
It's important for consumers to recognize that third-party collection agencies often snap up these debts for mere pennies on the dollar. That is what gives them incentive to continue to go after even seemingly minor debt amounts for months or even years after the debt was originally due.
However, consumers should also avail themselves of the knowledge of their rights, as spelled out in the Consumer Financial Protection Act, the Fair Debt Collection Practices Act and other laws.
The protections apply regardless of whether you legitimately owe the debt. While the list of forbidden actions by creditors is extensive (you can read a full list by clicking here), generally speaking, collection firms can't use tactics that are abusive, deceptive or unfair. That can include things like threatening arrest or violence or calling you at all hours of the day or night, or calling you at work after you have told them you can't accept calls there.
Let's say one of these firms has violated your rights. Your next step is to file a complaint. You can do this either through the FTC, the Florida Attorney General's Office and even directly to the debt collection agency. You have the right to demand that the debt collector cease contact with you. The FTC recommends that if you take this route, you send your demand via certified mail.
After that communication has been received by the collection firm, the only time it can contact you is to inform you of a specific action taken against you, such as a lawsuit. If you need help drafting a letter, visit www.consumerfinance.gov to find some templates. Of course, consulting an experienced attorney is often the best course of action.
One thing you want to avoid is ignoring the situation. Burying your head in the sand will not make it go away. You might only have a narrow window of time during which you can exercise certain rights. In some cases, you might have only 30 days to request information such as verification that the money is indeed owed. If you don't act and later are sued, the collection agency can use this as a weapon against you.
Also, avoid debt-settlement programs. Despite their promises, these for-profit companies will often cost you more than they will save you.
If you feel overwhelmed by debt and debt collectors, contact our consumer rights lawyers. We are qualified to help you sort through your financial situation and help you develop a plan that will allow you to manage your debt. We can also help shoulder the burden of fighting off aggressive and wayward debt collectors.