Fair and Legal Debt Collection
The Fair Debt Collection Practices Act is a federal statute that
curtails unfair, abusive, or outrageous practices and tactics
by collection agencies. View the Federal
Fair Debt Collection Practices Act
What Debts are covered?
Personal, family, and household debts are covered under the Act.
This includes money owed for the purchase of an automobile, for
medical care, or for charge accounts.
Who is a Debt Collector?
- A debt collector is any person, other than the creditor, who
regularly collects debts owed to others.
- A creditor who, collecting from his/her own debtors, uses a name
other than his/her own.
- An attorney who collects debts on a regular basis.
Not all debt collectors are subject to the Act . It does not apply
to banks, other lenders, or businesses that collect their own
accounts using their own names, nor does it cover them when they
collect an isolated debt for another.
How May a Debt Collector Contact You?
A debt collector may contact you in person, by mail, telephone,
telegram, or FAX.
A collector may NOT contact a debtor:
- before 8 a.m. or after 9 p.m.;
- at inconvenient or unreasonable places;
- at a place of employment if it is known the employer prohibits such
contact;
- if an attorney is known to represent the debtor, the attorney should
be contacted instead.
Can You Stop a Debt Collector From Contacting You?
You may stop a collector from contacting you by writing a letter
to the collection agency telling them to cease all communications
with you and that you will deal with the creditor directly. The
letter should be sent by certified mail with a return receipt
requested. Remember to keep a copy of the letter.
Once the agency receives your letter, they may not contact you
again except to say there will be no further contact. Another
exception is that the agency may notify you if the debt collector
or the creditor intends to take some specific action. Ceasing
contact does not preclude a lawsuit.
May a Debt Collector Contact Any Other Person Concerning Your Debt?
A debt collector may contact a person other than the debtor only
to discover or verify the debtor's location. The collector must:
- identify himself, but he must identify his employer only if expressly
requested to do so;
- not reveal the consumer's indebtedness to anyone other than the
debtor or his/her attorney;
- not use a post card or in any way reveal debt collection activity.
The collection agency may contact any person besides yourself about
your case only once. If a collection agency bill collector calls
a third person more than once, they should warn the collector not
to call again or they will complain to the Federal Trade Commission.
Validating The Debt
Within five days after contacting a debtor about paying a debt,
the collector must send a written notice that includes:
- the name of the creditor and the amount of debt;
- that the debt will be assumed to be valid unless disputed within
30 days; if disputed, the collector will verify it and send a copy
of the verification or of a judgment against the consumer.
During a period when a debt is being verified, the collector may
not attempt to obtain payment.
Debt Collection Practices That Are Prohibited
Harassment... Debt collectors may not harass, oppress, or abuse
any person; they may not:
- use threats of violence or harm against the person, property, or
reputation;
- publish a list of consumers who refuse to pay their debts, except
to a credit bureau or advertise the debt;
- use obscene or profane language;
- repeatedly use the telephone to annoy someone;
- telephone people without identifying themselves.
False statements... Debt collectors may not use any false statements
when collecting a debt; they may not:
- use false, deceptive or misleading representations as to their
identity, such as falsely implying they are attorneys or government
representatives;
- falsely imply that you have committed a crime or state that you
will be arrested if you do not pay your debt;
- misrepresent the amount of your debt;
- misrepresent the involvement of an attorney in collecting a debt;
- indicate that papers being sent to you are legal forms when they
are not or indicate that papers being sent to you are not legal
forms when they are;
- state that they will seize, garnish, attach, or sell your property
or wages unless they or the creditor intends to do so and it is
legal to do so;
- give false credit information about you to anyone.
Unfair Practices... Debt collectors may not engage in unfair
practices such as:
- collect any amount greater than your debt, unless allowed by law;
- make you accept collect calls or pay for telegrams;
- deposit a post-dated check prematurely
Source: State of Indiana Department of Financial Institutions