If you've been paying attention to the news, you might have caught wind of potential changes to debt collection rules. Federal regulators have proposed a series of regulations to ease the burden on debt-riddled consumers. These rule modifications arrive in response to a seemingly endless number of consumer credit defaults and debt collectors' relentless pursuits of those unpaid debts.
The Basics of Debt Collection Rule Changes
The proposed alterations to debt collection practices would significantly alter the industry's landscape. Of critical importance is the emphasis on reducing ongoing creditor harassment. Debt collectors have endlessly harassed most of those who are unable to pay their bills. In some instances, these unscrupulous debt collectors have even contacted debtors through their work phone lines. Some debt collectors have even gone as far as contacting debtors' family members by phone.
A Response to False Debts?
Part of the reason why federal regulators are tightening the leash on debt collectors is the fact that plenty of people are being pestered and sued for debts they do not owe. In some instances, individuals' wages have been garnished for debts that were accrued by others. The bottom line is that plenty of unpaid debts have been sold several times over. These debts are referred to as "bought paper," and they typically lack detailed documentation pertaining to the true identity of the debtor and important details about the debt itself.
Debt Collections Rule Change Details
The recently proposed regulations would force debt collectors to provide extensive documentation for each debt they attempt to collect. Collectors would be required to make consumers aware of their right to dispute the debt. If the proposed changes become law, debt collectors will be forced to strictly observe statute of limitations that make it illegal to pursue aged debts. It would also be illegal for collectors to contact alleged debtors more than six times in a week. Once the debtor perishes, collectors would be legally required to wait a minimum of 30 days before attempting to collect the unpaid debt from the decedent's family members.