Handling collection communications

By Richard Kistnen, Esq.

If you have ever missed a credit card payment or two, you may be familiar with the nightmare that inevitably follows.  You first receive a “kind” letter indicating that you have missed a payment and, to avoid any adverse consequences, you should remit a payment as soon as possible.  You miss a second consecutive payment which is followed by a not-so-nice letter indicating that the company is disappointed that you have failed to satisfactorily maintain your account and that, if payment is not promptly received, the account will be forwarded to collections.  You miss a third payment and the dread of collections begins.
Letters indicating that the delinquent account has been reported to credit agencies arrive.  Telephone calls from a wide variety of numbers from a wide variety of places, some appearing on caller identification and some being identified, begin to come in.  The calls are made early in the morning, throughout the day, and late at night.
Consumers have come to accept this treatment as a reasonable consequence of their failure to make a payment.  The purpose of this piece is to survey generally the laws and protections available to consumers, especially within the framework of collections activity.
One law that reigns in what debt collectors can do is the Fair Debt Collection Practices Act, (hereinafter, “FDCPA”).  The FDCPA is a broad-sweeping federal law that covers many parties that act as debt collectors.  Further, the FDCPA broadly outlines the kinds of activities that debt collectors may NOT engage in while attempting to collect a debt.  A little more specifically, the FDCPA prohibits a debt collector from engaging in harassment or abuse in collecting a debt, engaging in false or misleading representations in collecting a debt, or engaging in unfair practices in collecting a debt.  While the statute itself lays out activities that are prohibited, it does so broadly.  Over the years, the courts have defined particular activities which are precluded by the FDCPA.
Most states have extended the protections afforded to consumers with their own version of the FDCPA, often referred to as the Unfair Deceptive Acts and Practices laws (hereinafter, “UDAP”).  Generally, the state version of the laws encompasses even more parties as debt collectors.  Many state UDAP laws also offer more damages for a successful consumer litigant.
Setting aside litigation, there are a number of actions a consumer can take to address the often illegal practices of debt collectors.  The first line of defense is obtaining an attorney.  Most of these consumer protection laws explicitly state that if a consumer debtor is represented by a lawyer, the debt collector shall not communicate with the consumer debtor.
Generally, the attorney may require a fee to send a notice of representation and handle collection communications, but it is a very effective way of deflecting harassing or unfair practices.  Another suggestion is to save debt collection letters and to record debt collection phone calls.  By making a record of calls, including time and date, keeping the massive amounts of letters sent, and possibly recording phone calls where debt collectors use foul language or abusive treatment, the consumer is preserving evidence that would eventually be used at trial if a consumer protection lawsuit is brought.
Ultimately, if you, like me, use a credit card, you have entered a contract to repay the credit extended to you.  In an economy that is still sputtering, it is often difficult to make payments, especially when accounting for exorbitant interest rates.  Notwithstanding, a failure to make payments is no excuse for a debt collector to engage in harassing, unfair or misleading acts and practices prohibited by law to collect that debt.
Understand that there exist laws to protect the consumer when facing such acts and practices.
It is highly advised that you speak with a lawyer if you believe you have been subjected to harassment, unfair or misleading practices by a debt collector attempting to collect a debt.  If you have any questions about consumer protection laws, feel free to reach the Law Office of Richard Kistnen.