Jul 16, 2013 Philip Burgess
A change in debt collection regulations is set to affect California debt buyers. According to insideARM, the Fair Debt Buying Practices Act was recently approved by the California General Assembly. Support for the bill was overwhelming, as it passed in a unanimous 72 to 0 vote. The source noted that the state's Senate also approved the bill in unanimous fashion in May.
The new law will affect debt purchasing practices across the state. Now, debt buyers will be required to present a number of files and documents prior to attempting to close a debtor's account. Debt buyers must have documentation in their possession that proves they now own the outstanding account, information about the last payment date and a complete record of title for a specific account.
Also, the source noted that the law will force debt collectors to inform consumers of a number of rights they are afforded at initial contact. In fact, the bill provides specific, very detailed guidelines for the exact wording that should be included in written statements sent to debtors.
Now, debt collectors in California must adhere with the new state laws as well as those that are federally enforced, like the Fair Debt Collection Practices Act (FDCPA), which prohibits a number of activities. According to the Federal Trade Commission, even repeatedly calling a debtor can be classified as harassment, which is forbidden by the FDCPA.