The Truth of Credit

The Fair Debt Collection Practices Act is a must read for anyone in deep debt. There are numerous stories circulating around the Internet about debtors that sue creditors for not following the act properly. In fact there is whole industry of attorneys that deal directly with these cases. Here is my take on a very important part of the Act Section 807 and some tips to look for:

A debt collector may not use any false, deceptive, or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this section.

Rick’s Take: To understand this you need to know some history. Before FDCPA, Collection Agencies could pull out all the stops to get you to pay.  They’d send letters with judicial symbols like the example below to trick debtors into believing they were being litigated:

This is now a forbidden practice under this Section of the Act because it is misleading the consumer that this is a legal document when it is not.

(4) The representation or implication that nonpayment of any debt will result in the arrest or imprisonment of any person or the seizure, garnishment, attachment, or sale of any property or wages of any person unless such action is lawful and the debt collector or creditor intends to take such action.

Rick’s Take: This is tricky and collectors often step over the line here when they speak.  “Action” is a powerful word; it’s one that I refrain from using in my “Talk-Offs” with debtors. However, to clarify there are some accounts that are in a “Pre-Legal status” which means that the creditor has every intention of collecting the debt owed and therefore can indicate potential consequences of non-payment.  Make sure you’re clear on the status of your account.

 (7) The false representation or implication that the consumer committed any crime or other conduct in order to disgrace the consumer.

Rick’s Take: Fortunately, it’s not a crime to be in debt. As far as disgracing the consumer, well that could mean different things to different people. Some people think it’s disgraceful to call them about their debts. Others, you can call a dead-beat and they will blow it off.  It’s important to understand that you will not be sent to jail for avoiding your creditors.

The TRUTH is that Section 807 contains vital protection for the consumer against renegade debt collectors. As I’ve said before if you see any sign that you maybe getting in over your head with debt I implore you to read the FDCPA. It’s 28 pages long, you could easily be done in less than and hour and fully aware of your rights.  

Here is a full description of Section 807

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