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New Jersey Collection Laws

You are protected under several federal laws below. Scroll down to learn more about debt collection harassment, robocalls, unauthorized electronic payments, and credit report problems.

Fair Debt Collection Practices Act (FDCPA):

The FDCPA has been around since 1977. The FDCPA is a federal law that applies to every state. In other words, everyone is protected by the FDCPA. The FDCPA is essentially a laundry list of what debt collectors can and cannot do while collecting a debt, as well as things debt collectors must do while collecting a debt.

  • Damages:If a collection agency violates any section of the FDCPA, the consumer is entitled to damages up to $1,000.00. Additional damages are warranted in cases where the collector’s collection activities were so egregious the consumer suffered emotional distress. 99% of cases do not involve emotional distress damages.

  • Attorney’s fees: The FDCPA has a fee-shift provision. This means, the collection agency pays the consumer’s attorney’s fees and costs.

  • Debt that is covered by the FDCPA: Only consumer debt, such as personal, family, and household debts. For example, money you owe on a personal credit card, an auto loan, a medical bill, or a utility bill. The FDCPA does not cover debts you incurred to run a business, debts regarding unpaid taxes, or traffic tickets.

  • The FDCPA only applies to 3rd-party debt collectors: The FDCPA defines a debt collector as any person who regularly collects, or attempts to collect, consumer debts for another person or institution. In short, only third-party debt collectors are bound by the FDCPA. That is, original creditors, such as credit card companies and banks are not bound by the FDCPA.

Top FDCPA Violations:

  1. Communicated (phone or letter) with you after you filed for bankruptcy.
  2. Communicated (phone or letter) with you after you told the collector you have a lawyer.
  3. Called you about a debt you do not owe after you informed the collector you do not owe the debt.
  4. Called you at work after you told them you cannot receive such calls at work.
  5. Left you a message without identifying the company’s name.
  6. Left you a message without disclosing that the call is from a debt collector.
  7. Called third parties (family, friends, coworkers, or neighbors) even though the collection agency knows your contact information.
  8. Disclosed to a third party (family, friends, coworkers, or neighbors) that you owe a debt.
  9. Contacted you after you told the collection agency, in writing, to stop contacting you.
  10. Threatened you with legal action (such as a lawsuit or wage garnishment) even though the collection agency does not intend to follow through with its threat.
  11. Called you before 8:00 AM or after 9:00 PM.
  12. Continued to call you after you have told the collector you cannot pay the debt.

Telephone Consumer Protection Act (TCPA):

Have you ever received a phone call from an unknown but local phone number? Chances are you have, most everyone of us has, and when you answered the call you were greeted with silence or some pre-recorded message. After a few awkward seconds and repeating yourself to be removed the list, you hang up frustrated by another robot calling your phone. What do they really want, and why don’t they ever stop calling?

Fortunately for consumers, the TCPA, limits the use of automatic dialing systems, prerecorded voice messages, and unsolicited text messages. Passed in 1991, the TCPA allows for damages ranging from $500.00 – $1,500.00 per call or text. In describing the importance of the TCPA, Senator Hollings, the TCPA’s sponsor, said, “I echo Supreme Court Justice Louis Brandeis, who wrote 100 years ago that ‘the right to be left alone is the most comprehensive of rights and the one most valued by civilized man.’”

If a company has your permission to place robocalls to you, you can revoke your consent. If robocalls continue after the consumer says stop calling, the consumer has a TCPA case.

Electronic Fund Transfer Act (EFTA):

The EFTA protects electronic payments that are deducted from bank accounts. If a company took unauthorized deductions from your bank account, you may have an EFTA claim. Most collection agencies want to set up re-occurring payments from consumers. Imagine how much money collection agencies gets if hundreds, if not thousands, of consumers electronically pay them $50-$100, or more, per month. If you a consumer agreed to this type of re-occurring payment, the company must follow certain steps to comply with the EFTA. The EFTA allows for statutory damages up to $1,000.00 and actual damages for the payments made. The EFTA also has a fee-shift provision. This means, the company pays the consumer’s attorney’s fees and costs.

Fair Credit Reporting Act (FCRA):

The FCRA works to ensure that no information reported to your credit report is false. In essence, it gives you the right to dispute those inaccuracies that you find on your credit report. Are you one of the 40 million Americans that have a mistake on their credit report? Mistakes on your credit report can be very costly. Along with causing you to pay higher interest rates, you may be denied credit, insurance, a rental home, a loan, or even a job because of these mistakes. Some mistakes may include someone else’s information on your credit report, inaccurate public records, stale collection accounts, or maybe you were a victim of identity theft. If a credit reporting agency violates its obligations under the FCRA, you may be entitled to statutory damages up to $1,000.00, plus the credit reporting agency will be required to fix the error. The FCRA also has a fee-shift provision. This means, the credit reporting agency pays the consumer’s attorney’s fees and costs.

Under the FCRA, you have a legal right to dispute and remove inaccurate information from your credit report. These inaccuracies come in three common forms:

  1. Wrong information – Untrue information such as criminal records, driving records, accounts you did not open, mixed or merged files with someone else’s information (such as a family member or someone with the same name), judgments for lawsuits which didn’t involve you, or debts you did not incur can be permanently removed from your credit report.

  2. Duplicate information – Some accounts or transactions may be listed more than once in your credit report, and it’s helpful to ensure that your report is duplicate-free to avoid appearing to have more debt or credit-related problems than you do.

  3. Old and negative information – Most types of outdated negative credit information, such as foreclosures, judgments, liens, lawsuits, and bankruptcy, can be removed after about seven years.

Submitted Comments

Alexa
12 months ago
I recently looked at my credit score and noticed that smile direct club put my bill in collections. I never received a phone call or anything in the mail.
Joseph
7 months ago
I signed a contract with AFF on April 17, 2023. I received the furniture in May 20, 2023. My Automatic payments were scheduled to be taken out starting May 26, 2023. I was to pay $72.80 every week till May 29, 2025. No money had been taken out since I put a deposit. I’ve logged in to customer portal on AFF since last month and it said I had no open accounts. I never received a letter in the mail nor a phone call. All these forms of contacts were given at the time of the Contract signing. No money has been taken out or has tried to. I looked into my spam a few weeks ago and saw that they emailed me on July 29, 2023 and ended up in the spam mail stating that my date for payment will start on August 4, 2023 in the amount of $72.52. I waited and still no funds were attempted to be taken out. Then I received another email on August 12, 2023 stating that my patents will start being taken out from my banking account on August 18, 2023 for $72.52. I waited again and no attempt. Then I received another email in my spam on August 24, 2023 that my payments will start being deducted from my account on Sept 1, 2023 in the amount of $73.36. I called AFF and explained I want no business with this company because they broke the contract. My payments were to be automatically deducted from my checking or debit card on May 26th. They changed my dates 3 times and changed the prices 3 times. I also expressed why I haven’t I received a call or letter in the mail regarding why dates and charges were changed and different. I got no where and I had no choice but to call FinWise Bank to let them know what AFF was doing and that the contract is voided. They have the legal team at AFF look into this. I just need someone who can look into this and see what I can have done.