Debt Collectors Now Face Federal Oversight

Debt collector's now face federal  oversight

Corky’s Debt to His Father (Photo credit: Wikipedia)

Debt Collectors Now Face Federal Oversight

Check with your local State Department of Business Regulations to see if the debt collector is registered as legally required.  Many debt collectors forget to renew their registration.  If their registration has lapsed they have no legal standing to report or verify any debt.

January 2, 2013 marked the beginning of the oversight of debt collectors by the Consumer Financial Collection Bureau.  Debt collectors now face federal oversight that should definitely have the worst of them cleaning up their act in a hurry.  Those debt collectors that contract with the Education Department to collect the 850 billion dollars in student loans will be included under the CFPB’s jurisdiction.

“Millions of consumers are affected by debt collection, and we want to make sure they are treated fairly,” Richard Cordray, director of CFPB says.  “We want all companies to realize that the better business choice is to follow the law–not break it.”

Collectors are now required to have a process to resolve disputes and communicate “civilly and honestly” with consumers.  Collection companies with annual receipts of $10 million or more are covered, amounting to about 2/3 of the debt collection companies in the U.S.

Past abusive practices have consisted of repeated calls and even threatening debtors with prison say consumer advocates.  The Consumer Financial Protection bureau now requires reports and will examine the compliance and procedures of the debt collectors for risky practices.  The FTC says it collected more than 180,000 complaints about debt collectors in 2011, up from 13,950 in 2000.

The CFCB plans to hold a public hearing in Seattle on debt collection practices soon.  The new sheriff is in town and the days when debt collection went by rules that can only be compared to those of professional wrestling are gone forever.  What a relief!

Consumer’s Now Have an Appeal Process

Consumer’s should first dispute questionable items directly with the original creditors and/or the credit reporting agency that is carrying the negative item.  As always it pays to keep careful written records of the progress of your complaint.  When you are not satisfied with the result you can file a brand new complaint with the Consumer Financial Protection Bureau.  You can do this by filling out their form  at their web site.  Or you can write them a letter with copies of your proof. They offer real time tracking of your complaint.  Here you will get a thorough analysis that will not leave you with that uneasy feeling.  The credit reporting agency’s so called investigations have been little more than a one sided process favoring the alleged creditor in the past.  That is changing for the better.

You are “Making a Federal Case” out of your complaint

We’ve all heard or used the expression “You’re making a federal case out of this” by people who feel a problem is being treated with exaggerated seriousness.  Well, when you file your appeal with the CFPB that is what exactly what your are doing.  This will help you or hurt you depending on how it’s implemented.  Details and proof will win or lose your case.  Take advantage of the fact that debt collector’s now face federal oversight.  Debt collectors do not like federal involvement.  No one case is worth it.

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After practicing law for 37 years Edward F. St. Onge, Sr. now devotes all his time to helping consumers achieve a high credit score with amazing speed. Learn the counter-intuitive secrets to credit scoring through his down to earth instructions backed by extensive knowledge of the laws and trends. All of the latest tricks and techniques that they don't want you to know now at your disposal. At last a level playing field for the consumer!

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