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CREDITOR CALLS

This discussion is intended to provide a brief and non-dispositive overview of the matters covered. It is not intended to be legal advice (see conditions for use of this Web Site). Recognize that every situation is unique, and the law is constantly evolving (and the discussion may not represent the latest developments). We recommend that you consult an attorney licensed to practice in your jurisdiction if you are seeking legal advice.

1.   Statutes Affecting Collection Practices

2.   Phone Calls



There are two sets of statutes that regulate collection from consumer debtors in Pennsylvania. One is the federal statutory scheme, called the Fair Debt Collection Practices Act ("FDCPA") (located at 15 U.S.C. § 1692 et seq). The other is a Pennsylvania Statute, called the Fair Credit Extension Uniformity Act ("FCEUA") (located at 73 P.S. § 2270.1).

A significant difference between the FDCPA (the federal law) and the FCEUA (the state law) is that the FDCPA only applies to "debt collectors." Debt collectors are third parties (typically collection agencies and attorneys) who are in the business of collecting debts. The FDCPA does not regulate the conduct of creditors seeking to collect their own debts. The FCEUA, on the other hand, applies to both debt collectors and creditors seeking to collect their own debts.

Both sets of statutes prohibit harassment (such as threats of violence, use of obscene language, or engaging in conduct with the intent to annoy, abuse or harass), the use of false statements (collectors implying they are someone they are not or that they can do something they cannot, or that they have or will sue you when they haven't or won't), or unfair practices (such as threatening to collect more then they are entitled to under applicable law). For a general list of the limitations put on debt collectors under the FDCPA see FTC Facts for Consumers, and under the FCEUA see Pa Attorney General Information Page.

If you believe you are the victim of harassment, false statements or unfair practices in the course of collection activity you should consult an attorney.


Dealing with Calls after you have engaged an attorney or filed for bankruptcy

Both the state and federal law prohibit communications to a consumer about a debt if the collector is put on notice that the consumer is represented by an attorney (unless the attorney fails to respond to the collector's communications). Furthermore, a bankruptcy filing will stay all collection activity.

It may be necessary for you to communicate to the collector that you have engaged an attorney or have filed for bankruptcy (if one or the other is applicable). You should, of course, give the collector your attorney's name, address and telephone number if you are represented.

Where you have filed for bankruptcy it may take a few weeks for the notices of the bankruptcy filing to be sent out by the court and processed by the creditors. In the meantime, you may still get calls. Where there are creditor calls after a bankruptcy filing you should give the case number, district where you filed, date of filing, chapter, name of your attorney, attorney's address, and attorney's telephone number.

Of course, the calls should slow down and eventually end after you have engaged an attorney (and told the creditors of that fact) or filed for bankruptcy. If you receive repeated calls notwithstanding your having provided the identity and contact information for your attorney or, if relevant, information about your bankruptcy, there is a problem and you should notify your attorney. If the collector demands you provide more information about your plans (if you have engaged an attorney) or your bankruptcy (if it has been filed), there is a problem and you should notify your attorney.

Dealing with calls before you have engaged an attorney

Outside of calls that are deemed to be harassment, there is no general prohibition on calling. Calls that are deemed to be harassment include:

  • calling at any unusual time or place or a time or place known or which should be known to be inconvenient to the consumer (which is assumed to be before 8am and after 9pm) (15 U.S.C. § 1692(a)(1) and 73 P.S. § 2270.4(B)(2)(i));

  • causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number (15 U.S.C. § 1692d and 73 P.S. § 2270.4(B)(4)(v)); or

  • calling at the consumer's place of employment if the collector knows or has reason to know that consumer's employer prohibits him or her from receiving such communication (15 U.S.C. § 1692(a)(3) and 73 P.S. § 2270.4(B)(2)(iii)).
There are, however, some strategies to try and reduce volume.

(i) Filter Calls through a telephone answering machine

This is, of course, is the easiest way to avoid dealing with collectors, although it does require you to be able to withstand the ringing phone (although that, too, can be turned off or muted).

You may want to retain the answering machine tapes, and discuss them with an attorney, particularly if the messages are offensive, or appear to contain false statements.

Anything beyond filtering calls will likely require you to actually talk to the collectors. Our recommendation is that every call should begin with you requesting and writing down:

  • the name of the collector making the call;
  • the company for whom the collector works;
  • the company's physical and mailing address;
  • the company's phone number and the collector's extension;
  • the name of the creditor for whom the call is made (if the call was made by a "debt collector");
  • the "account number" assigned to your account (and if the call is by a "debt collector," the original creditors account number); and
  • the date and time of the call, and whether the call was to you at work.

(2) Demand "debt collectors" cease communications

The FDCPA (at §1692c) requires a "debt collector" to cease further communication with the consumer if the consumer notifies a debt collector in writing that they refuse to pay a debt or wish the the debt collector to cease communications. After such a letter the most the debt collector is permitted to do is acknowledge the request or advise that they may or will exercise their legal rights (provided that it is true).

Telling a debt collector you won't pay or not to call you anymore does not prevent the collector (or the creditor) from filing suit, but, as long as you communicated your demand in writing, they have to stop calling you.

(3) Demand "debt collectors" validate the debt

The FDCPA requires that a debt collector provide consumer debtors with a notice of their right to obtain validation of the debt. [Validation is nothing more than verification from the creditor of the debt or a copy of the judgment (if applicable).] The notice of your right to demand validation will be in a writing sent to you at or around the time of the first call (and will usually be included in the first letter you receive from a debt collector demanding payment). The notice will advise you that unless you request validation (in writing) within thirty (30) days of your receipt of the notice the debt collector will assume that the debt is correct. It obviously doesn't require much for the debt collector to obtain verification, but demanding validation of the debt (again, in writing) will slow debt collectors down (they are not permitted to proceed with further collection activity until they have provided you with the validation information).

(4) Demand creditors collecting for their own accounts cease communications

Unlike the FDCPA (which only regulates "debt collectors") the state law (FCEUA) does not contain anything that gives you the right to demand that the communications cease (except with respect to calls to your place of employment where your employer does not permit you to receive such calls). That, notwithstanding, if the calls become burdensome, you should send a letter demanding that the calls stop. If nothing else, that should cause the creditor to think twice about excessive calling.

Of course, as with the FDCPA, getting the calls to slow down or stop does not mean that the debt goes away. As with the FDCPA, the result of a demand that communications cease may be the initiation of a collection lawsuit.

To the extent communications persist after you have sent such a letter (whether to a debt collector or a creditor), keep a log of the date and time of each subsequent communication, the identity of the individual responsible (if you take the call or the information is otherwise provided), and a transcript of the communication, and forward that information to your attorney when you finally engage one.


One form of letter is as follows:

[Date]

[Name and address of creditor or debt collector]

     Re: [Name or names on the account]
     [Creditor’s account No.]
     [Account number utilized by debt collector, if applicable]

Dear Sir/Madam:

     By this letter I demand that you cease all further communications with me to the maximum extent provided by the Fair Debt Collection Practices Act, at 15 U.S.C. § 1692 et seq, and the Pennsylvania Fair Credit Extension Uniformity Act, at 73 P.S. §§ 2270.1 to 2270.6. Among other things, without my permission you are expressly prohibited from communicating about my debt with any person other than me, my attorney, a consumer reporting agency if otherwise permitted by law, a debt collector, the attorney of the debt collector or the attorney of the creditor. [I am particularly concerned about calls to my place of employment.]

     [If true] Please be advised that my employer prohibits my receiving calls from creditors or debt collectors while at work.

     [If true] Please be advised that I have engaged counsel with respect to this debt. The attorney’s name, address, and telephone number is as follows: ________________________________________.

     I hereby demand that all communications to me cease immediately.

     [If you have an attorney, add] If there should be any question regarding this letter, I recommend you contact your attorney.





For information, questions, comments, etc., contact us at katzlawoffice or at the telephone or fax numbers set out on these pages. PLEASE NOTE: (1) the transmission of e-mail may not be secure and, in any event, would not create an attorney-client relationship; (2) we limit our practice to Pennsylvania (provided, however, we assist Pennsylvania clients who have matters outside of Pennsylvania with the assistance of local counsel); (3) the discussions in these pages are for general information and are not intended to be, and do not constitute, legal advice and are not a substitute for legal assistance -- we recommend you engage the services of a professional licensed to practice in your jurisdiction for legal advice and representation when confronted with any legal matter; (4) the engagement of our firm is subject to a written engagement agreement (and the terms and conditions of that agreement). Utilization of this site does not create a legal relationship.

Dated: 2007