As if it’s not bad enough that debt collectors can call you several times a week to try to collect a debt, a new law will allow third-party debt collectors to text people who owe if it’s passed. The Consumer Financial Protection Bureau (CFPB) has proposed new rules to govern how third-party debt collectors contact borrowers. The new proposal is designed to speed up the switch from calls and emails to text messages to remind consumers to pay their debts.
If the law is passed, third-party debt collectors would only be able to call a delinquent borrower seven times a week (at the current time, there is no limit to the calls). The new law also proposes that once the debt collector reaches a borrower by phone, no further calls can be made in the same week to that particular borrower.
However, the CFPB is proposing there be no cap on the number of texts or emails a collector could send, which consumer advocacy groups say will “open the door to allowing debt collectors to use text messaging, WhatsApp, Facebook Messenger or other text-based messaging services” as much as they want—even to the point of harassment. The CFPB, however, insists there will be an “opt out” for consumers to stop bill collectors’ texts and emails. According to the proposal, debt collectors will be banned from posting public messages on a debtor’s Twitter, Facebook, and other social media accounts.
Changing Ways Americans Communicate
In an article by the Associated Press, proposed changes by the CFPB were said to be “a reflection of how many Americans communicate. Fewer Americans have landline telephones, and they speak on the phone less frequently than 10 years ago. Texting and email have become more common ways of communicating with friends or family.” While the debt collection industry has used email and texting to reach borrowers for many years, but the industry says it was “operating in a legal gray area.”
Debt Collection Practices
The Fair Debt Collection Practices Act (FDCPA) is the federal law that indicates what debt collectors can and cannot do when attempting to collect a debt. Did you know that if you tell a debt collector that it’s inconvenient for you to be called at work, they have to stop calling you there immediately? Debt collectors aren’t permitted to discuss your debts with other people, so they are not permitted to contact your family members, coworkers, neighbors, or friends about your debt. Debt collectors also must abide by the debt collection laws of the states in which they operate.
Forbidden Debt Collection Practices
Here are just a few of the most notable facts regarding debt collection practices:
- Debt collectors can’t charge you interest, fees, or collection charges (except those amounts that were authorized by the agreement with the creditor to whom the debt is owed)
- A debt collector can’t use abusive or threatening language in order to collect a debt
- Debt collectors cannot threaten to seize your property
- They can’t repeatedly call (over a certain number of times) in order to intimidate, harass, or provoke the borrower
- They cannot call without identifying themselves and who they’re representing
- They cannot threaten to show up at your job or home
- They cannot falsely identify themselves as a government employee or member of law enforcement
- They cannot imply that you will be arrested or lose your job if the debt is not paid
- They cannot imply that someone is coming to your house to collect money
- They can’t send false documents to your home or work
- They cannot threaten to make your debt public
- They cannot try to collect more than you actually owe
Knowing federal and state laws regarding debt collection practices will help you understand what your consumer rights are in the event you’re contacted by a debt collector.