What is the Fair Debt Collection Practices Act?

Key points

• There are laws that protect you from harassment by predatory debt collectors.
• Debt collectors must be honest and polite and must respect your privacy.
• When a debt collector crosses the line and violates the law, you can consult an attorney and reach out to regulatory agencies.
• You can also request that the collection company verify the debt if you believe they’re seeking more than you owe or pursuing you for a debt you didn’t take on.

Getting insistent, repetitive phone calls is never fun, whether it’s from spam, or even a family member. But perhaps the most unpleasant kind of persistent caller is the debt collector. We’ve all heard stories of them crossing the line into being pushy or downright harassing.

However, there are laws governing debt collectors’ collection practices that are intended to protect your time, privacy and peace of mind. “I urge debtors to do some research and understand their rights,” says Michelle Kuipers, staff attorney for Ladder Up, a Chicago-based financial literacy nonprofit. “Look into the Fair Debt Collection Practices Act (FDCPA) and use the online resources provided by government regulators such as the Federal Trade Commission(FTC) and the Consumer Financial Protection Bureau (CFPB).”

Once you know what debt collectors aren’t allowed to do, you’ll know when you should take action and push back. Here’s a look at what rules debt collectors have to follow and how to respond when a company’s practices cross the line.

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The origins of the fair debt collection practices act

First of all, aggressive debt collectors are nothing new. When the FDCPA was passed in 1977, Congress noted that there was “abundant evidence of the use of abusive, deceptive and unfair debt collection practices by many debt collectors.” Legislators also pointed out that these invasive practices could break up marriages, get people fired and push borrowers into personal bankruptcy.[1]

Tip: Debt collectors can’t call you at work once you make it clear that that’s unacceptable to or prohibited by your employer—you can simply tell them that your employer forbids these calls.

Because of these concerns, the FDCPA was signed into law on Sept. 20, 1977. According to the text of the law, its purpose was to stop abusive collection practices, creating a standard so that ethical debt collectors weren’t at a competitive disadvantage and ensuring a consistent government response when consumers face abusive practices.

What are fair debt collection practices?

The act outlines what fair debt collection practices look like as well as what’s not allowed. Here is what you can expect debt collectors to adhere to:

Reasonable calling times

According to the law, debt collectors can only call you between 8 a.m. and 9 p.m. in your time zone. If you work nights or have another valid reason why you can’t be reached during those hours, they have to adjust their hours.

Protecting your privacy

Debt collectors aren’t allowed to embarrass you by airing your dirty laundry to the public. They can’t send you postcards (which could be read by third parties), put you on “bad debt” lists or talk to your co-workers or roommates about your debt. 

“Creditors cannot communicate with third parties apart from the debtor, the debtor’s authorized attorney or a consumer reporting agency unless authorized to do so by the debtor or by a court,” Kuipers explains.

Being honest and polite

Debt collectors can’t deceive you or misrepresent your situation, and they can’t use abusive or profane language. They also aren’t allowed to seek unjustified amounts, aka more than you owe, and they can’t report false information to your credit report nor threaten to do so.

“​​It’s a violation of the FDCPA for a debt collector to threaten judicial or nonjudicial actions that can’t legally be taken or that the lender doesn’t actually intend to take,” Kuipers says, “For example, they can’t threaten to have you arrested when you aren’t committing a crime or threaten to garnish your wages when they don’t intend to even attempt that action.”

Stopping when told

This is a bit more complicated, but there are quite a few situations where a debt collector has to stop contacting you after you’ve given them notice. If you notify them in writing that you wish no further communications or you refuse to pay the debt, they have to stop contacting you, but can take you to court to collect what they’re owed. You can also stop debt collection calls by getting an attorney—debt collectors can’t contact you after you’ve told them to go through your attorney, with some exceptions.

Sending a debt validation letter

Let’s face it: While there are legal limits, as long as you have debts you’re behind on, you will be contacted by debt collectors. But understanding your rights will help you to know when their practices cross the line into illegal harassment. 

If you feel a debt collector is pursuing a debt you actually don’t owe, or asking for more than you owe, send them a debt validation letter. A debt validation letter is essentially a request that they prove that you owe the debt. After you send this letter, they either have to verify the debt information or stop collection actions completely.

However, once you receive the verification of the debt, the clock starts running: You have 30 days to dispute the debt—that is, to push back and clarify that you don’t owe this money. The CFPB, a government agency that works to ensure you’re treated fairly by banks and lenders, recommends that you communicate with your debt collector in writing and by certified mail with signature confirmation or receipt of delivery verification.[2] It’s very important to pay attention to the details in this process, so take the time to dot your i’s and cross your t’s.

Tip: Make sure to date your debt verification letter to “start the clock” on the 30-day timeline for making your case about your debt.

Getting the debt collector to stop contacting you

You can also send a written notice to the debt collectors themselves requesting that they stop contacting you. Under the FDCPA, they must stop contacting you once told in writing.

“This doesn’t mean the debt will disappear or that the debt collector can’t take legal actions to collect from you” Kuipers explains, “but it does mean the debt collector must stop communications except a mailed notice that the collector will terminate efforts to communicate with the debtor or a mailed notice that the collector is going to invoke specific remedies—such as a lawsuit.” 

Tip: The CFPB provides a series of sample letters you can send to debt collectors based on what you believe the underlying problem is, such as if you believe you don’t owe the debt or if you want to specify how the debt collector can contact you.

Seeking legal and regulatory help

If a debt collector isn’t responding to your letters, it’s time to bring in outside help. “You can lodge official complaints with the Federal Trade Commission, the Consumer Federal Protection Bureau and your state’s attorney general’s office,” Kuipers says. “They’re able to launch investigations into activity that’s illegal under the FDCPA and hold the debt collectors responsible with a variety of legal actions and regulatory tools.”

You can also talk to an attorney about your personal legal options. If you’re behind on payments, you’re likely not in a financial situation where hiring an attorney seems feasible, but many attorneys will offer a free consultation to review your case and see if they can help you. “You can seek legal advice from a private attorney or local legal aid organizations specializing in debt and get help determining whether you might have a cause of action to sue a debt collector that has done something illegal,” Kuipers advises.

Tip: A lawsuit needs to be filed within one year of the action that allegedly violated the FDCPA.

Being pursued by a pushy debt collector is stressful, but knowing your rights and the methods available to push back can help you make the right choices. If a debt collector is violating your rights and behaving unethically, you do have routes to stop the harassment and regain your peace of mind.