The Fair Debt Collection Practices Act or FDCPA was developed in order to protect consumers from being harassed by collection agencies. It has been observed that many consumers were choosing the option of bankruptcy being threatened by debt collectors. It Thus, a federal law called the FDCPA was passed to provide guidelines of debt collection.
The important facts:
Debts or under FDCPA-Typesdebts covered by FDCPA may vary slightly from state to state. In some states, the law may cover a wider range of types of debt, but in most cases are similar: The types of debt, which generally are covered under the Act are:
- Personal Loans
- The home equity loans
- Car Loans
- Loans to finance retail
- Loans for the purchase of medical care
- Credit Card Debt
- First mortgage
- Second Mortgage
OThe debt covered by FDCPA-The law provides general guidelines for all parties involved in debt collection in relation to others. However, there are some specific inclusions and exclusions. Individuals and organizations whose behavior is governed by the FDCPA Act are:
- Collection Agencies
- Business Recovery
- Creditors who collect debts from other creditors
- Collection Attorneys knowlawyers who serve debt recovery
- The creditors collecting debt under false names
Notes - Individuals who provides misleading collection
Debt collectors or not covered by the FDCPA - There are some debt collectors, whose activities are not restricted by the FDCPA. The parties that are excluded by law are:
- In the house staff or collection of creditors collecting debts
- Bankscollect debts
- Credit card companies like Chase, Visa, Mastercard, Citibank, American Express, MBNA.
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