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What Is The FDCPA?

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In order to battle the matters associated with harassing debt collectors and debt collection companies, the Fair Debt Collection Practices Act (also known as the FDCPA) was formed. The laws and regulations authorized by the Fair Debt Collection Practices Act not only safeguard consumers, but they also help debt collection agencies as well by encouraging them to perform in a serious and professional manner when engaging in speech with supposed debtors.

In most affairs lenders are within their rights to search for payment. This includes situations where the borrower is careless in their responsibilities and then in the end default on their financial obligations, and or if the borrower simply needs additional time due to rough financial circumstances and strain. These above situations represent instances in which the lender is not earning his due payments from the borrower when they began with a reasonable expectation of being paid back in an adequate time frame. No matter the reason in these cases, the lender in question is legally within their rights to seek payment that they are due.

In these situations, many times lenders have no other appeal but to become involved with a collection agency. The goal of collection agencies is to recover and collect all of the monies that are owed to their clients (the lenders). Due to the Fair Debt Collection Practices Act, collection companies can no longer act heedlessly and with neglect for the consequences of their actions when aiming to recover monies for their clients.There are several stipulations that come along with the Fair Debt Collection Practices Act as enacted in 1978. These stipulations both protect debtors and enable collection companies to strongly pursue valid debts.

Even if a debtor advises a collections representative to terminate all further contact with him there are other means by which a debt collection representative may aim for the valid debt. For example, under the FDCPA, while the collection rep must agree with the debtors request to cease any further contact with them, they are also perfectly within their rights to make the debtor aware that they intend to pursue the debt via legal channels through an attorney.

If the collection agency responsible for recovering the delinquent account cannot communicate with or cannot reach the debtor, then they are legally allowed to contact third parties related to the debtor. However, under the FDCPA there are some boundaries to contacting third parties. First and foremost, the collection rep cannot harass the third party or be non-courteous. Also importantly, the collection rep cannot violate the right of privacy of the debtor by disclosing the nature of the call to this third party.

Among guidelines for collection agencies to adhere to, the Fair Debt Collection Practices Act also has a penalization system in place for those collection companies that do not adhere with the aforementioned stipulations. These penalties against collection agencies found to be in violation of the FDCPA include: fines; license revocation; and even legal actions.

At first glance it appears as though the guidelines of the Fair Debt Collection Practices Act are strongly skewed toward the debtor. However, these rules also protect the debt collection agency by helping them steer to wards fair practices and policies in a courteous and professional manner. Without the FDCPA, the unprofessional behaviors of some select few collection agencies would go unchecked and thus would undermine the entire reputation of the business of debt collection.


ABOUT THE AUTHOR: JONATHAN SUMMERS
Mallory McGuinness is employed by a collections agency that works with a debt collection lawyer. She also does stories on business, finance, the credit industry and collections agencies.

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