New Mexico outlines debt collection rules

New Mexico's debt collectors will soon have new guidelines to follow thanks to a rule enacted by the state's attorney general. Attorney General Gary King announced that the state would begin to enforce a rule that would require debt collection agencies to inform people when their debts have exceeded the statute of limitations and are no longer subject to court cases. The "Collection of Time-Barred Debt" rule will force those in the collection sector to tell people when the time period of enforcement has passed either through written or telephone communication. "Under the state's Unfair Practices Act, the fact that a debt is so old that a person can not be sued to collect on it is considered material," said King. "If it is material, New Mexico law requires that it be disclosed to the debtor. This rule is intended to ensure that debt collectors provide important information to consumers so that they can make informed decisions when they are confronted with a demand to pay an old unenforceable debt." Other government agencies are reviewing debt collection laws as well. The Los Angeles Times reports that the Federal Trade Commission is getting ready to crack down on overzealous debt collectors with new protection laws relating to the debts of those who have passed away.