If you have incurred a significant amount of debt in recent years, you are not alone. During these tough economic times, many people have fallen behind on credit card bills, student loan payments, and even mortgage payments. In these instances, you may be contacted by a debt collector seeking to recover the money you owe. Although debt collectors have the right to contact you about unpaid debts, they are required by law to do so fairly.
It seems as if debt collection agencies are some of the most disliked companies in the United States. This is not because consumers must pay them, but because of the tactics they sometimes use to collect debts. And while both state and federal governments have regulations that make many of these actions illegal, some collection agencies still regularly practice such activities.
The best way to learn about your rights and options is to speak with Los Angeles consumer protection lawyer Howard Silver. Please call 818-597-2610 today to schedule a free consultation. We proudly help those who live in Los Angeles, Riverside, Ventura, San Bernardino, and other nearby areas of California.
- Reasons for Unfair Debt Collection
- Common Unfair Debt Collection Practices
- Federal and California Fair Debt Collection Practices Acts
- What You Can Do About Unfair Debt Collection
Reasons for Unfair Debt Collection
Loans are something most people will have to deal with at some point during their life. Unfortunately, creditor harassment is becoming common in California and throughout the United States. Even though both California and federal law make many tactics used by debt collectors illegal, unlawful activity still takes place.
Many consumers want to pay off their debt in ways that collection agencies do not want. This may mean smaller payments than required or even late payments. Collectors are required to inform consumers of the debt agreement and the agreed-upon penalties in a civil and regulated manner. However, many agencies believe this will not change the actions of a debtor. As such, they will use intimidation tactics to force payment.
Collection agents are typically paid by commission. They receive a percentage of the amount of money they collect. This, unfortunately, can cause agents to resort to illegal actions to coerce a consumer to pay a debt they do not owe. However, although an agent may use wrongful and abusive tactics, it does not necessarily mean that he or she enjoys what is happening. Companies have been known to pressure employees with:
- Threats of being fired
- Providing an environment that encourages unfair tactics
- Offering financial incentives to the employee to pursue questionable debts
Some agencies, whether on purpose or by mistake, will buy debt from other agencies that have either been paid off or no longer qualify for collection. When discovered, the agency may attempt to still collect on the debt. To prevent customers from realizing that they do not need to pay the debt or pressuring them to pay it when they know better, many unfair tactics such as threats of legal action and constant harassment will be used.
Common Unfair Debt Collection Practices
Unfortunately, there are many ways in which debt collectors may use unfair debt collection strategies against you. Thankfully, however, the Federal Debt Collection Practices Act (FDCPA) has established rules that debt collectors must follow. According to the FDCPA, it is illegal for debt collectors to commit any of the following actions:
- Seek an unjustified amount
- Contact a third party about the debt
- Harass, abuse, or oppress a consumer they contact
- Use threats of harm or violence, publishing names of debtors, use profane language
- Repeatedly and consistently call the consumer, especially before 8:00 a.m. or after 9:00 p.m.
- Give false statements or misrepresent the debt
- Give false credit information about you to anyone
- Send documents that look official, but aren’t
- Use a false company name
- Engage in unfair collection practices,
The above bullet points outline some of the general tactics that debt collectors have been known to use and have been made illegal by the FDCPA. In our experience, we’ve come across specific examples of these types of illegal tactics which debt collectors have used, including:
- Claiming they are someone other than a debt collector
- Falsely claiming that the consumer has committed a crime
- Lying about the amount owed
- Making false claims about whether documents are legal forms
- Telling the consumer that unless the debt is paid, they will be arrested
- Telling the consumer that their wages or property will be seized or garnished when this is not legally permitted
- Telling the consumer that legal action will be taken against them when there is no intention to follow through with these actions or it would be illegal to take legal action
- Trying to collect fees, interest, or other charges on top of the debt (unless allowed by terms of the contract or by law)
- Depositing a post-dated check early
- Contacting the consumer by postcard
Federal and California Fair Debt Collection Practices Acts
There are many laws in place to protect American consumers from unfair and deceptive business practices, including the Fair Debt Collection Practices Act (FDCPA), which was enacted in September 1977 and went into effect in 1978. The FDCPA was created to prevent deceptive and abusive tactics by debt collectors. These types of collection practices contributed to a number of other problems, including personal bankruptcies, loss of jobs, invasions of privacy, and even marital instability.
According to § 802 of the FDCPA, the purpose of the federal Act is "to eliminate abusive debt collection practices by debt collectors and to promote consistent State action to protect consumers against debt collection abuses." However, despite the passing of the Act into law, many debt collectors still use unfair, deceptive, and abusive practices to collect debts from consumers.
In addition, the state of California has passed its own law, the Rosenthal Fair Debt Collection Practices Act, which provides additional protections for consumers. The California FDCPA, Sections 1788-1788.3 of the CA Civil Code, states that “unfair or deceptive collection practices undermine the public confidence which is essential to the continued functioning of the banking and credit system and sound extensions of credit to consumers.” This being said, the Act prohibits debt collectors "from engaging in unfair or deceptive acts or practices in the collection of consumer debts.”
Although unfair debt collection practices still occur, the FDCPA provides consumers with a basis for redressing injuries inflicted by debt collectors. If a consumer suspects that a debt collector has violated state and/or federal law, he or she can report the debt collector to the Federal Trade Commission (FTC), their state Attorney General, and, depending on the situation, file a civil lawsuit for damages and attorney's fees or contact local law enforcement.
What You Can Do About Unfair Debt Collection
To protect yourself against unfair debt collection practices and harassment, it is important to understand what rights you have under state and federal law. If you’ve been the victim of unfair, abusive, or deceptive debt collection tactics, you should:
- Consult the Federal Trade Commission (FTC): The FTC provides information about what debt collectors can and cannot do. The goal is to eliminate abusive practices and protect consumers.
- Report Your Complaint: Consumers who have been the victims of abusive tactics can file a complaint with the state attorney general's office and the FTC. By reporting the problem, you can build a better case against the violator.
- Stay Aware of Your Debt: Always make sure you know the exact amount that you owe and to whom. In this way, you will avoid paying too much or for a debt you don't owe.
- Tell the Collector to Stop Contacting You: Debtors can ask collection agencies to stop contacting them. While this won't get rid of the debt, the harassing conduct will stop.
- Take Legal Action: Sometimes debt collectors will not stop their abuse, no matter what actions a victim takes. Therefore, victims may need to seek legal representation to stop the wrongful conduct and collect penalties and damages.
If you have been the victim of unfair debt collection practices, Mr. Silver can help you file a civil lawsuit to stop this illegal conduct and recover compensation for your damages.
Contact Our Experienced Unfair Debt Collection Attorney Today
If you or a loved one has been subjected to abuse by a debt collector or debt collector harassment, you do not need to suffer further mistreatment. Our attorney, Howard D. Silver, understands the emotional and financial toll caused by such actions. He is dedicated to putting a stop to such abuse.
If you are being harassed, deceived, or abused by a debt collector, Mr. Silver can get you the relief you need from this difficult situation. To learn more about how we can help, please fill out the form on this page or call 818-597-2610 for a free consultation. Mr. Silver serves clients in Los Angeles, Riverside, San Bernardino, Glendale, and throughout California.