If you recently got a text, email or social-media message from a debt collector, here’s one of the first things you should do: Make sure you know your rights.
New Consumer Financial Protection Bureau rules, which took effect Nov. 30, clarify how debt collectors can use modern communication methods such as email, text messages and social media to communicate with consumers, among other things.
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“Consumers need to be educated about what to expect and how to protect themselves,” says Leslie Tayne, a New York-based debt-relief lawyer.
Here are answers to frequently asked questions about how the new rules affect debt collection.
How can debt collectors contact me?
Debt collectors can now contact you via email, text messages and social media, as well as traditional forms of communications such as telephone call or postal mail.
Are there limits to how debt collectors can contact me online or through text or email?
Yes. Debt collectors must identify themselves as such. Also, any messages they send have to be private—so they can’t broadcast your debt on your Facebook FB -0.20% wall or Twitter TWTR 0.20% feed, for instance. They can, however, attempt to friend you on social media, provided they let you know they are debt collectors. They must also give you the option to opt out of these communications. Debt collectors who violate allowable practices are subject to enforcement by the Federal Trade Commission and may also be held accountable for state-law violations. Consumers may be able to sue a debt collector in state or federal court, though there are time limits.
How often can a debt collector call me?
Under the new rules, debt collectors can’t attempt to call more than seven times within a seven-day period about a particular debt. That restriction applies if you don’t answer them; if you do, they can’t call you within seven days after engaging in a phone conversation about a particular debt, according to the CFPB. Keep in mind that these restrictions don’t apply to text messages, emails and other types of media.
Are there potential downsides for consumers with the new debt-collector rules?
There could be some, Ms. Tayne says. For instance, you have to go through the trouble of opting out of these communications, and people who don’t regularly check social media or miss an email may fail to see critical information about a debt. With the new ability to reach people online, through email and via text, there could be more bad actors attempting to scam people into paying them money on alleged debts, Ms. Tayne says.
How can I verify the debt collector is legitimate?
Start out by asking the name, phone number and physical address of the debt-collection agency that collectors are working for, Ms. Tayne says. Technically you shouldn’t have to ask because they are required to provide you with certain information when they first communicate with you or soon after, generally within five days, according to the CFPB. This includes the name and mailing information of the debt collector, the name of the creditor and the debt amount. You shouldn’t give debt collectors any personal information until adequately verifying the debt and the agency are legitimate, Ms. Tayne says.
How else can I avoid a debt-collection scam?
Beyond asking for verification of the debt-collection agency and the proof of debt, it is also advisable to contact the original lender to discuss details including whether your account should be in collections, who was hired to contact you and the status of your debt, Ms. Tayne says.
What if I don’t recognize a debt?