What Is The Fair Debt Collection Practices Act?

The Fair Debt Collection Practices Act requires that debt collectors treat you fairly by prohibiting certain methods of debt collection.

What Types Of Debt Collection Practices Are Prohibited?

Debt collectors may not harass, oppress, or abuse any person. For example, debt collectors may not:

• falsely imply that they are attorneys or government representatives.
• falsely imply that you have committed a crime;
• falsely represent that they operate or work for a credit bureau;
• misrepresent the amount of your debt;
• misrepresent the involvement of an attorney in collecting a debt;
• indicate that papers being sent to you are legal forms when they are not;
• indicate that papers being sent to you are not legal forms when they are.

Debt collectors also may not state that:

• you will be arrested if you do not pay your debt;
• they will seize, garnish, attach, or sell your property or wages, unless the collection agency or credit intends to do so, and it is legal to do so (garnishment is currently prohibited in South Carolina for the collection of most debts);
• actions, such as a lawsuit, will be taken against you, which legally may not be taken, or which they do not intend to take.

Debt collectors may not:

• give false credit information about you to anyone;
• send you anything that looks like an official document from a court or government agency when it is not;
• use a false name.

What Methods are Available for a Creditor to Collect on a Judgment?

Each state’s civil code lists the different methods that are available to a person who is trying to collect on a judgment.  Some of the more common methods include the following:

• Wage garnishments or assignments;
• Property liens or attachments;
• Debtor exams;
• Contempt proceedings and
• Sheriff’s sale.

Where Should I Report Violations Of The Fair Credit Reporting Act?

Although the FTC can't act as your lawyer in private disputes, information about your experiences and concerns is vital to the enforcement of the Fair Credit Reporting Act. Send your questions or complaints to:

Consumer Response Center — FCRA
Federal Trade Commission
Washington, D.C. 20580.

Someone who owes me money filed for bankruptcy.  How do I know if I can still collect my debt?

If you are a creditor, or someone to whom the debtor owes money, then you will be given notice of the bankruptcy proceedings, as well as notice to file a claim for the amount of your debt in cases where some assets are available. You also will receive a notice from the bankruptcy court that indicates if and when the debtor’s debts are discharged.

Can a Debtor's Wages be Garnished to Satisfy What He/She Owes?

Many states allow a creditor to garnish the wages of a debtor who has defaulted on his or her loan payments if certain conditions are met. For example, most states limit the amount of a person’s wages which may be garnished and provide wage garnishment exceptions if a debtor’s income is below a certain level. The amount of time during which a debtor’s wages may be garnished may also be limited.

It is important to remember that, in most cases, you must file a lawsuit and have a judicial judgment in order to garnish wages. Also, it may be difficult to garnish the wages of low income debtors, debtors who already have their wages garnished for child support, alimony, tax deficiencies or other creditor claims or debtors who are public employees.

Can a Judgment Creditor Obtain a Lien Against the Debtor's House?

Yes.  A judgment creditor can take the judgment and file it in the county recorder’s office, which will then show up as a debt on the debtor’s title to their home that must be paid from the proceeds should the home ever be sold.  In some states, once a property has a judgment lien filed against it, the holder of the judgment can even force the home owner to sell the home so that the debt will be paid.

How can I demand payment on a debt that I am owed?

You can write a formal demand letter to the party who owes you a debt. In your letter, you should be as specific as possible about the debt that you believe that you are owed, and request that the debt be paid by a certain date. On the other hand, enlisting the assistance of an attorney can make a demand letter much more effective; plus, an attorney who handles the matter for you can also advise you on any other issues that might arise.