Maryland Fair Debt Collection Laws

The Maryland Fair Debt Collection Act prohibits debt collectors and creditors from engaging in deceptive, threatening, or other abusive collection behavior.

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In Maryland, the federal Fair Debt Collection Practices Act (FDCPA) and state law regulate debt collectors. The FDCPA applies to every state, and it protects consumers from unfair and deceptive debt collection practices. The FDCPA also prohibits debt collectors from contacting you at certain times and places. Likewise, Maryland has a law protecting consumers from deceptive and abusive behavior by people and businesses collecting debts.

The Maryland Consumer Debt Collection Act (MCDCA) adds significant protections to consumers because it covers activity by both debt collectors and creditors. In most situations, the FDCPA only covers debt collectors.

Debtor Protections Under the Federal FDCPA

The federal FDCPA sets limits on what debt collectors can and can't do when attempting to get you to pay a debt. For example, the FDCPA:

  • prevents debt collectors from talking to third parties about your debt (subject to some exceptions)
  • calling you at work when you tell them not to do so, and
  • engaging in other tactics designed to harass, abuse, or mislead you into paying a debt.

Who Must Comply With the FDCPA?

The FDCPA applies to debt collectors and some third-party debt buyers, but it usually doesn't cover collection activities that an original creditor performs. (But when collecting its own debts, a creditor must comply with the FDCPA if it uses a different name that implies a third party is attempting to collect the debt.)

Maryland's Consumer Debt Collection Act

Maryland law protects consumers from abusive and deceptive debt collection tactics. While the Maryland law is similar to the FDCPA, it also offers additional protection to consumers. For example, it covers creditors as well as debt collectors. (Md. Code Ann., Com. § 14-201).

In addition, the Maryland consumer protection scheme requires that collection agencies be licensed and regulated by a state board. (Md. Code Ann., Com. § 14-202).

Which Debts and Collectors Does the Maryland Consumer Debt Collection Act Cover?

The MCDCA applies broadly to any collector. A collector is "a person collecting or attempting to collect an alleged debt arising out of a consumer transaction." (Md. Code Ann., Com. § 14-201). So, unlike the FDCPA, which only applies to people in the business of debt collection (with a few exceptions), the MCDCA covers individuals, estates, or any kind of business or legal entity. So, any person or business seeking payment, such as a creditor, as well as any collection agency or lawyer hired to collect a debt, must comply with the MCDCA.

The Maryland Act covers activity related to the collection of a debt resulting from any transaction involving a person seeking or acquiring "real or personal property, services, money, or credit for personal, family, or household purposes." (Md. Code Ann., Com. § 14-201). So, the law covers most consumer debts, like credit card bills, charge card accounts, car payments, consumer leases, and mortgages.

Prohibited Debt Collection Practices in Maryland

The MCDCA prohibits the following debt collection activities.

Collectors and Creditors Can't Make Threats

Collectors and creditors may not intimidate a debtor by:

  • threatening force or violence
  • threatening to disclose information that would negatively affect any debtor's reputation for creditworthiness if the collector or creditor knows that the information is false
  • threatening criminal prosecution unless the transaction involved the violation of a criminal statute
  • using abusive language, including obscenity or profanity, when communicating with debtors or their relatives, and
  • communicating with debtors or their relatives frequently, at unusual hours, or in any way that could be considered harassment or abuse. (Md. Code Ann., Com. § 14-202).

Third-Party Communications Are Generally Prohibited

Collectors and creditors may not threaten to communicate with a third party, such as an employer, to undermine the debtor's reputation. Nor may the collector or creditor contact the debtor's employer unless the collector or creditor has a final court judgment confirming that the debt is owed. (Md. Code Ann., Com. § 14-202).

In a few instances, though, a creditor or collector may communicate with a third party. A collector or creditor may contact the debtor's spouse or, if the debtor is a minor, the debtor's parents. A collector or creditor may also contact a third party who has a legitimate business reason to know about the debt, such as someone who has guaranteed the debt. (Md. Code Ann., Com. § 14-202).

Collectors and Creditors May Not Use Deception

A collector or creditor may not try to trick anyone into paying a debt. In particular, a collector or creditor:

  • must not claim it has a right that it knows does not exist or attempt to enforce such a fictional right, or
  • must not send any written communication that imitates any form of judicial process from a court, government entity, or lawyer. (Md. Code Ann., Com. § 14-202).

What to Do If a Collector or Creditor Violates Debt Collection Laws

If a collector or creditor violates the law, you can take one or more of the following actions.

Contact the Maryland Attorney General's Consumer Protection Division and the Department of Labor

You can contact the Maryland Attorney General's Consumer Protection Division or call their hotline at 410-528-8662 and contact the Maryland Department of Labor, Licensing and Regulation Commissioner of Financial Regulation.

The Maryland government may take action against a collector who violates the MCDCA. A collection agency can lose its license for violating the MCDCA.

File a Complaint With the Consumer Financial Protection Bureau

You can also file a complaint with the Consumer Financial Protection Bureau (CFPB) if you have an issue with a debt collector or creditor. After you submit a complaint, the CFPB will work to get you a response, typically within 15 days.

File a Lawsuit Against a Collector or Creditor for Violating the MCDCA

Under the MCDCA, a debtor can sue for actual damages. Maryland law doesn't mention punitive damages but does say the debtor can get damages for "emotional distress or mental anguish." (Md. Code Ann., Com. § 14-203).

File a Lawsuit Against a Collector for Violating the FDCPA

If a debt collector uses abusive or deceptive collection behavior that violates the federal FDCPA, you might also be able to file a lawsuit under that federal law. You can file in state or federal court. If you win, you could get actual damages plus up to $1,000 in extra damages. You can also get attorneys' fees.

If you need help initiating a lawsuit, talk to a debt relief lawyer.

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