Fair Debt Collection Practices Act

The Fair Debt Collection Practices Act (FDCPA) prohibits “debt collectors” from engaging in certain bad acts. Critically, the act only applies to debt collectors, collecting or attempting to collect a “debt”.

 Under the FDCPA, a debt collector is defined as any person who regularly collects or attempts to collect debts owed to others. This includes debt collection agencies, lawyers who collect debts on a regular basis, and companies that buy delinquent debts and then try to collect them. Some of the debt collectors working in Montana include Centron Services, Inc., operating as Credit Systems, Rocky Mountain Professional Solutions, and other names; Collection Bureau Services; and CB1 Collections. Many other national debt collectors also operate in Montana.

 Importantly, the FDCPA only applies to third-party debt collectors. It does not apply to the original creditor or the entity that initially extended the credit or loan. In other words, the FDCPA only applies to companies that are hired by the original creditor to collect the debt, but not the creditor itself. For example, if you are sued by Amex or Discover Card, those entities are not considered debt collectors because they are the original creditor. This means the FDCPA does not apply.

 Additionally, the debt collector must be collecting or attempting to collect a “debt” A “debt” under the FDCPA includes includes any obligation or alleged obligation of a consumer to pay money arising out of a transaction in which the money, property, insurance, or services which are the subject of the transaction are primarily for personal, family, or household purposes, whether or not such obligation has been reduced to judgment. This definition applies to a variety of debts including credit cards, medical bills, personal loan, and utility bills.

 Importantly, the FDCPA does not provide protection if the debt was obtained for a commercial or business purposes.

 If you are being contacted by a debt collector attempting to collect a debt, please review our Debt Collection website to learn more, and contact our office to see if we can help.