The recent changes implemented by the Consumer Financial Protection Bureau (CFPB) to Regulation F of the Fair Debt Collection Practices Act (FDCPA) carry enormous import on debt collections agencies across America, with a particular emphasis on how they contact individuals.

Those who work with our team at Summit A•R to recover income owed to their company are often apprehensive about their account status. This makes sense, given the emotional strain that lost revenue can have on a business owner.

The case can sometimes be exacerbated by business owners who have unsuccessfully attempted to recover their income alone for long periods before contacting us. This situation only goes to reveal the necessity of working with professionals rather than letting the problems of lost income grow – exponentially.

Transparency in Collections 

In such cases, it can be helpful to understand the process that we take in recovering your money and the regulations in place that guide the actions and conduct of collections agencies. In keeping with our mandate of transparency regarding these issues, we at Summit A•R regard it as critical that we update our clients with the latest changes regarding debt collection in the USA and how they impact our company.

Our P.H.D. Philosophy

In an ideal world, we wouldn’t need protections debt collection laws or like the Fair Debt Collection Practices Act (FDCPA) in place because every company that works in collections would understand the futility of using unethical tactics in the process of resolving unpaid debt.

That’s why we hold a P.H.D. Philosophy at Summit A•R, which stands for Preserving Human Dignity. We believe that every person deserves to be treated with dignity and respect in all interactions.

When you’re hiring a collection agency to ensure that debts that are owed to your company get resolved, it is vital to work with an ethical company that does not employ pressure tactics. Unethical collection practices harm individuals; they are also ineffective, and do not comply with the Fair Debt Collection Practices Act (FDCPA) rules.

Changes to CFPB’s Regulation F

To recap on the recent changes to Regulation F, the Fair Debt Collection Practices Act (FDCPA) has been updated with two “final rules” regarding the debt collection process and how agencies can contact individuals.

The first of these rules deals primarily with the use of language. In contrast, the second rule regards what information collections agencies must provide to consumers regarding their debt and under what circumstances collections agencies are permitted to share information about those consumers to third parties such as credit bureaus.

The main reason for these additions to Regulation F is not only to clarify the use of language but to address changes in the debt collection process made possible by new technology such as

  • Emailing
  • Smart Phones
  • Instant Messaging
  • Social Media

Since the way that we communicate has changed, the regulations that address communications in debt collection need to change as well to address new technology.

Definitions and Common Questions

Given the importance of ensuring that collections agencies follow the changes to Regulation F correctly, the CFPB has published a helpful clarification to assist anyone seeking to understand some of these changes. Expressly, they have provided answers to common questions regarding

  • Limited-Content Messages
  • Telephone Call Frequency
  • Presumptions Regarding Call Frequency
  • Rebutting these Presumptions
  • Excluded Calls

To share this information with our clients seeking debt collection options, the following guide provides a summary of the new clarifications by the CFPB. Much of this information regards clearly defining terms outlined in Regulation F.

It is important to note that the purpose of each of these summaries is to provide a general impression of how the goals of the changes to the Fair Debt Collection Practices Act (FDCPA) guide its choices. It is not meant to provide an exhaustive explanation of every rule, which can only be garnered through a careful reading of the source documents.

Limited-Content Messages

The term limited-content messages may appear ambiguous given that it is difficult to determine how much content counts as limited and where the strict defining lines may be drawn for legal purposes. While it contains essential information about the debt in question (required content), it may also contain optional information, referring to unessential pleasantries like the date and a salutation.

Telephone Call Frequency

While regulation F does not specify a numerical limit or frequency to the number of calls a collections agency may make to in consumer credit collections to an individual, it does stipulate that frequency cannot be used to

  • Annoy
  • Abuse
  • Harass

the person in question.

Telephone Call Presumptions

Although the section regarding Telephone Call Frequency states that there is no limit on the calls a collections agency may place to a consumer, the Telephone Call Presumptions section specifies otherwise. In this section, it is presumed that placing more than seven calls in a period of seven days or placing a call within seven days of engaging in conversation violates the prohibition against harassment.

Telephone Call Frequency: Excluded Calls

This section details calls that qualify as exceptions from the former calling prohibitions, such as when the collection agent has obtained permission from the consumer to place a call.

Telephone Call Frequency: Rebutting the Presumptions

This section details the means through which a consumer may prove that a collection agent violated the calling prohibitions, such as demonstrating evidence of call or voicemail frequency.

Validation Information

This term refers to the information that a collection agent must provide to a consumer to demonstrate that they owe a debt. Examples of this may include information that is

  • Debt-Related
  • Itemization-Related
  • Communication Disclosures
  • About Consumer Protections
  • Consumer-Response Details

each of these items is explained in further detail in the primary documents.

Validation Information: Residential Mortgage Debt

This section explains a special rule concerning residential mortgages that circumvents the collections agent’s requirement to supply itemization-related information to the party in question. However, it does stipulate that they must substitute this information with a periodic statement instead.

In Sum

Again, these examples merely illustrate the type of information that is clarified in the changes to Regulation F, along with the attitudes that guide those changes. If you are interested in gleaning a more comprehensive account of this information, it is recommended that you read through the helpful Frequently Asked Questions document provided by the Consumer Financial Protections Bureau.

The changes in Regulation F highlight the importance of ethical debt resolution practices no matter what form of communication is used. If you have outstanding debts owed to your company and want to be sure that you’re working with a collections agency that understands and follows the proper legal standards, get in touch with us.