The federal Fair Debt Collection Practices Act (FDCPA) offers consumers protection against overly aggressive debt collection actions by debt collectors and debt collection agencies. If a bill collector has violated federal law in its dealings with you, there are steps you can take depending on your goal. These range from suing the debt collector to reporting the collector to government agencies to using the violations as a negotiation tactic on the debt. (To learn about what bill collectors can and cannot do, see our Illegal Debt Collection Practices article.)
If a debt collector violates the FDCPA, you have several available remedies:
The consumer may bring a lawsuit against the debt collector in state court. In the lawsuit, you must prove that the debt collector violated the FDCPA. If successful, you may be able to collect $1,000 in statutory damages, and possibly more if you suffered harm from the violations. (To learn more about the amount and type of damages you can collect in a FDCPA lawsuit, see Damages for FDCPA Violations.)
In these lawsuits the consumer is almost always represented by an attorney. The amount of money that the consumer sues for includes the consumer’s attorney fees and costs. Suing in state court is almost always the most time consuming and lengthy of all remedies, but a successful lawsuit can award the consumer the highest monetary damages.
Small claims courts may be a better option for consumers who do not want to hire an attorney or spend the time required for a full-blown state court lawsuit. Small claims courts allow individuals to argue their case without an attorney and through an expedited process. These courts typically offer the consumer one shortened hearing in order to argue the case to a judge.
Usually, you file a simple court document to start the case. Hearings are usually held less than two months after the lawsuit is filed. At the hearing the judge may issue a ruling on the spot or take the case "under submission" and mail you the ruling at a later date. (Learn more about small claims court, including how to bring an action, in our Small Claims Court topic area.)
The disadvantage of using small claims courts is that Small Claims Courts limit the amount of damages that you can get. (To learn the limit in your state, see 50-State Chart of Small Claims Court Dollar Limits.)
The Federal Trade Commission (FTC) is charged with overseeing debt collector actions and ensuring that the FDCPA is not violated. Consumers can contact the FTC with FDCPA concerns. You can file an online complaint using the FTC's Complaint Assistant at www.ftccomplaintassistant.gov.
Consumers may also contact the Consumer Financial Protection Bureau (CFPB). The CFPB takes consumer complaints, passes those complaints along to the creditor, and then works with the consumer and creditor to find a solution to the problem. You can submit an online complaint with the CFPB at www.consumerfinance.gov/complaint.
In addition to violating the FDCPA, the debt collector may also be violating state laws. The consumer may want to contact the state Attorney General’s office in order to receive guidance on a possible FDCPA lawsuit and for any possible state law actions against the debt collector. Many of these offices also receive complaints against debt collectors—if it gets enough against one collector, it might prosecute on behalf of the state. To find your state's office, see State Consumer Protection Offices.
If you are trying to settle debt and the collector violates the FDCPA, you can use the violation as leverage to settle the debt. This often works because collectors know that a FDCPA lawsuit can be costly to defend and may result in a judgment against them.
How much leverage you get from the threat of a FDCPA lawsuit depends on the strength of your case. If you have strong facts proving a violation (multiple letters, records of multiple phone calls, testimony of coworkers who received phone calls, etc.), you will have much more leverage in debt settlement negotiations. (To learn more about negotiating with debt collectors, see Negotiating With Collectors on Unsecured Debts.)