New regulations proposed by the Consumer Financial Protection Bureau are expected to bring forth the most significant federal changes governing debt collection in more than 40 years. Many consumers deal with harassing calls and letters from creditors. Fortunately, debt collection companies will soon be required to provide more complete documentation on consumer debts before the hounding begins. They will also be limited to how frequently they may contact people regarding claims.
Welcomed relief for consumers
In the wake of cases so extreme that some people have even had their wages garnished for debts later proven to be illegitimate, new regulations regarding debt collection that favor consumers are a welcomed relief to many who have been experiencing creditor harassment.
With debts being bought and sold from one company to another on a daily basis, it should come as no surprise that supporting documentation is often insufficient for many companies to pursue legal action, yet consumers are left in the dark regarding appropriate recourse. Laws requiring documentation that is more complete will offer a great deal of protection to consumers who have been wrongly targeted by debt collection agencies and those who do legitimately owe money alike.
Less frequent calls and greater awareness of consumer rights
Debt collection agencies will soon be required to inform consumers of their legal right to dispute charges and will be forced to remain in compliance with the statute of limitations that restricts the length of time they are able to place a claim on an old debt. Moreover, agencies will be allowed to make no more than six attempts per week at contacting consumers in regards to debt repayment and will have to wait at least 30 days after a person has died before contacting their next of kin in pursuit of payment.
Many debt collection companies claim to be in favor of the proposed new rules, trusting they will bring consistency to an area in desperate need of legal clarification.