The Fair Debt Collection Practices Act (FDCPA) is a consumer protection law that restricts what third party debt collectors can say and do while attempting to collect a debt. If a collection agency conducts itself in a way that violates an indebted consumerâ€™s rights, that consumer can file a lawsuit against the company within one year and potentially be awarded $1,000 per violation along with actual damages, attorney fees and court costs.
The FDCPA and bankruptcy
When you file for bankruptcy in New York, there is an automatic stay that prohibits most collection efforts, including but not limited to:
- Wage garnishment
- Property seizure
- Phone calls and letters that attempt to collect the debt
The only legal actions a bankruptcy may not stop is child support cases, criminal proceedings and certain eviction actions. Should you incur any debts after filing for bankruptcy, then the automatic stay will not apply to associated collection actions if you default.
If a bill collector persists in trying to collect a debt that was included in your bankruptcy, you should immediately advise them of your filing. They are required to stop all previous collection action and drop the lawsuit, return all garnished wages, and / or do anything else required to rectify the error. If the collector refuses, you must notify the bankruptcy court, which will take the following steps:
- Sanction them for violating the automatic stay order
- Impose fines and order the collector to pay attorneyâ€™s fees and associated damages
Even if a debt collector is after an account that was not included in a bankruptcy filing, there are certain guidelines that dictate when and how they may contact you about the debt. The FDCPA does not permit them to contact you at inconvenient times, which are generally defined as before 8:00 a.m. and after 9:00 p.m. in your time zone, unless you have given the collector permission to call outside of those hours. Debt collectors may also not call you at your place of employment if you advise them that your employer does not permit you to take such calls.
Indebted consumers often complain about debt collectors calling their friends, family and co-workers. If you owe a debt and the collection agency does not have your contact information, they can reach out to third parties, but only to source your phone number. They may not reveal that you owe a debt or that they work for a collection agency.
Another common complaint is about debt collectors threatening or harassing consumers. The FDCPA was originally passed in 1977 after abusive debt collectors were linked to a rise in personal bankruptcies, Since then, it has been illegal for them to use methods like the following to persuade you to pay.
- Use profane and obscene language
- Threaten legal action they have no intention of taking
- Maliciously report false information to the credit bureaus
- Deliberately embarrass you by discussing the debt with your friends, relatives and co-workers
The FDCPA grants you the right to dispute a debt and tell the debt collector not to contact you any more, unless it is to advise that legal action has commenced or collection activities are ceasing.Â If they persist in contacting you, see a New York attorney who can help you file a lawsuit against the agency and get you the compensation that you are entitled to under the law. No matter how much you owe, all debt collectors must obey the law, or face expensive sanctions. Call lawyer Jayson Lutzky at 718-514-6619 to learn more about filing for a personal bankruptcy or if you feel that you are being unfairly harassed under the FDCPA. In-office consultations are free.