Federal, New York State and New York City laws regulate debt collection activities. These laws require certain actions of debt collectors and prohibit others. The laws are applicable to consumer debts, including for credit cards. All the laws apply to debt collection agencies, and in New York City to the actual creditors as well.
Contact Rules
It is legal for creditors and debt collectors to try to collect on outstanding debts. They are restricted by law on how they do this. They can contact the debtor by phone or mail, but may not call before 8 a.m. or after 9 p.m. Collectors are prohibited from calling a debtor at work if the debtor objects. They are allowed to contact third parties, but only to obtain the debtor's address or phone number. Contact with a third party is usually limited to one time only. Debt collectors may not contact a debtor represented by an attorney.
Required Disclosures
The law requires debt collectors to provide detailed information to the debtor regarding the debt. This information must be in writing and include the amount owed, the name of the creditor, the nature of the debt and a notice that the debt will be assumed as valid unless the debtor sends a written reply to the contrary within 30 days. In such a reply, the debtor has a right to demand legal documentation verifying the debt and its details. The collector is required to provide such verification before continuing with further collection activities.
Prohibited Actions
It is specifically prohibited to harass or try to intimidate the debtor or any third party. The debtor is allowed to demand in writing that any further contact cease and the collector must comply. The collector can not represent himself as part of the government or as an attorney, unless he is. Threats of any legal actions that are not available to the collector or permitted by law are prohibited. The collector cannot discuss the details of the debt or even reveal its existence to any third party except an attorney, without the debtor's permission.
Other Provisions
Actions considered to be harassment include repeated phone calls to the debtor or any third party. More than two phone calls per week is usually considered excessive. Any written correspondence sent by the collector must not disclose on the envelope that it is from a collector or involving a debt. Credit card debts in New York are limited to a six-year statute of limitations. People in New York called by collectors are legally permitted to record those phone calls without the collector's permission or knowledge.
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