Debt Collection Basics

In 1978 Congress passed a law known as the Fair Debt Collection Practices Act (FDCPA) and it was intended to curb abusive practices of companies that attempted to collect old, bad debts from consumers, many of whom had very little means to repay the debts.  Such abusive practices included threatening the consumer with criminal action that could not legally be taken, causing the consumer’s phone to ring repeatedly, the use of profane language, and the reporting of “false credit information.”

The FDCPA defines a debt collector in general as a third party collecting a debt for someone else or a creditor collection its own debt secured by a security interest (such as a mortgage which is a loan secured by property).

The FDCPA creates strict procedures that a debt collector must adhere to.  It specifically allows a consumer to dispute a debt within the first 30 days of the debt collector putting the consumer on notice that the debt collector is attempting to collect the debt.  And although the FDCPA does not specifically authorize a consumer to dispute a debt after the first 30 days, FDCPA does not prohibit this and case decisions (case law) have made it clear that a consumer can dispute a debt well after the initial 30 day period.