The Fair Debt Collection Practices Act (FDCPA) protects debtors from being harassed by creditors. If community associations violate the Act, residents can sue them for damages—even if they owe the debt. The Act is designed to spare homeowners from harassment and financial burden at the hands of creditors. For this reason, community managers and board members must know about basic provisions that may apply to HOA collections and additional facts about local and federal laws that affect how it’s interpreted in court.
The FDCPA outlines what a debt collector can’t do
- Lie, omit, or present misleading information
- Yell, swear, name-call, use racial slurs, or threaten violence
- Contact friends, family, co-workers, or neighbors and share details about a debt
- Call debtors at work after they’ve asked the collectors to stop
- Make threats to sue, garnish their wages, or claim they can be arrested or jailed
- Directly contact debtors who are represented by a lawyer
- Call debtors repeatedly to the point of harassment
- Do anything deemed as unfair, undignified, or disrespectful
What is considered “unfair” or “unreasonable” will be determined by the court. Equity Experts understands the laws and build your customized debt collection procedures with the FDCPA, state, and federal laws in mind from the beginning. We update the processes as laws are revised to maintain compliance at all times. The language used and the schedule for every communication is carefully planned out. Reports of all debt collection and accounting activities are always accessible for review.
The FDCPA strongly favors debtors, not associations. Often notices sent to delinquent owners that seem relatively clear to managers are misinterpreted by owners. If management gets frustrated, they may attempt actions that backfire. No matter how frivolous a claim appears, it’s easy for owners to win them. It’s important not to test the law in the first place.
How to be confident about compliance
Equity Experts is an innovator in the debt collections industry that focuses on community associations. We understand the need for an efficient and cost-effective collection solution for HOA and COA delinquencies, especially in tough economic climates. Our deferred cost collections model helps to maintain a healthy cash-flow. We truly understand the specific needs of managers and board members and offer customized solutions for each client.
We are continually evaluating our processes to provide the most effective services that are budget-friendly and convenient. You experience a one-stop-shop that reduces up-front costs and risks associated with standard debt collections. Our goal is to make sure your association will remain strong financially. Adding software integrations to collect data and generate accurate reporting on account activity allows you and your staff to focus on other important tasks.
With Equity Experts, you will always have FDCPA compliant processes, lower debt collection expenses, greater cash flow, and owners being treated with respect. Contact us for a consultation and review of your current processes. If you choose to work with us, you can rest assured that staff and residents are protected.
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