Debt Collection Rules Are Changing, Not for the Better

Debt Collection Rules Are Changing, Not for the Better

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Date: November 14, 2020Author: Joshua Denbeaux

The debt collection industry is a huge deal. It is a multi-billion dollar industry and over 90% of consumers have to deal with at some point during their lifetimes. When the debt collectors violate those rules, they can cause havoc to people’s lives. The same violation also creates an opportunity for consumers to sue the debt collector for abuse.

There is a yin and a yang here, with the debt collectors straining to push every envelope and cut every corner to collect as much money as possible … while limiting their exposure to being sued. By lawyers like me, I am proud to say!

And so, rather than play by the rules, they are kind of trying to cheat … by controlling the rules. This is not good for consumers.

The Consumer Finance Protection Bureau (CFPB) protects consumers. Hence the name. On October 30, 2020, the CFPB issued a final rule revising Regulation F, 12 CFR part 1006. This implements the federal Fair Debt Collection Practices Act (FDCPA).


Electronic Debt Collection Communications with Consumers

Under the new rules, debt collectors sending texts and emails must provide a way to opt-out. There must be an unmistakably simple way to opt-out of getting email and text messages.

Up until now, the debt collector had to write you a snail mail letter. No email, text, or anything else like that … it had to be a hard copy letter.

When a debt collector chooses to use text and email to message consumers, the consumer can also use text and email to respond. Placing either “a cease communication request” or notice that the consumer refuses to pay the debt.

This is a big problem:

  1. The cost for sending letters was significant when dealing with a large number of potential targets/victims. Without that cost, it is more likely that debt collectors will try to collect on many more dubious ‘debts’ than previously.
  2. Most people have multiple email accounts. I, myself, have five. Three of which are unused, meaning I do not ever check them. What that may mean is that a debt collector could email me and I would never know, never have an opportunity to dispute the debt or otherwise respond until I was sued.
  3. The mailing of the letter established an address. An address for service of the summons and complaint in the debt collection lawsuit. Now, without that established, debt collectors will make more ‘mistakes’ in serving lawsuits. That means that a more significant number of defendants will never actually receive a copy of the lawsuit and won’t even know they were sued until a judgment shows up on their credit report, their bank accounts get raided or their employer receives a wage garnishment order.


Telephone Call Contact Limits on Debt Collection

Under the new rule, a debt collector violates the FDCPA’s prohibition on repeated or continuous telephone calls “if the debt collector places a telephone call to a person more than seven times within seven days, or within seven consecutive days” of having had a telephone conversation with the person.

Previously, the limitation on calls was more robust. Seven times in seven days meant they can call you four times in one day, three times another and then take a short break before bombarding you again.

Receiving that many calls in a day would, under previous rules, have been harassing. This new rule permits it. Not good.


New Communication Provisions for Voicemail Debt Collection

The final rule “clarifies restrictions on the times and places at which a debt collector may communicate with a consumer, including explaining that a consumer need not use specific words to assert that a time or place is inconvenient for debt collection communications.”

It defines a new term concerning debt collection communications: “limited-content message.” Limited-content messages are voicemails. This rule identifies what information a debt collector must and may include in such a message. If a voicemail has only the permitted content, it is not a “communication” under the FDCPA.

That means that if you owe a debt, you can expect a huge number of voicemail messages.

I represent people harassed and targeted by debt collectors, but I almost NEVER leave voicemail messages. How do I know that someone other than the person I am trying to call is not going to listen to the message? For one, it is none of their business. Secondly, your private business would be more likely to be exposed. Again, not good.


Social Media Contact Not Permitted

Debt collectors may not use social media platforms to communicate if the communication is viewable by the general public or the person’s social media contacts.

That is a no-brainer, debt collectors were never going to be permitted to post your debt situation onto your facebook page. However, look out for your messenger account being blown up.


Model Validation Notices Still in the Works

In the Notice of Proposed Rulemaking process, the CFPB provided a model validation notice which would act as a safe harbor for debt collectors from a barrage of FDCPA lawsuits.

The CFPB states that it intends to publish a disclosure-focused final rule in December 2020 to clarify the information that a debt collector must provide to a consumer at the outset of debt collection and provide a model notice containing the information needed. FDCPA section 809(a).

This is designed to be a ‘Get Out of Jail Free’ card for the debt collection industry. It is terrible and wrong. If the debt collectors violate the rules, they should be sued and sued often. There is no need to put a thumb on the scales here.


If you’d like to read more about debt collection practices, you can find information here. If you think you someone has violated the Fair Debt Collection Practices Act (FDCPA), Contact Me! My consultations are always free, I’m here to help if you need me.


Sources Used to Prepare this Post
Consumer Financial Protection Bureau Issues Final Rule ….

Consumer Financial Protection Bureau Issues Final Rule to ….



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