CFPB issues long-awaited final rule on debt collection

Consumers and debt collectors have both been waiting for several years for the Consumer Financial Protection Bureau (CFPB) to issue its debt collection final rule. The 653-page rule clarifies bans on harassment and abusive debt collections, false or misleading statements by collectors and unfair debt collection practices.

The rule will take effect a year from now.

The rule clarifies how the Fair Debt Collection Practices Act (FDCPA) applies to communication technologies developed since the passage of the Act more than 40 years ago: email, text messages and voicemail.

Key provisions of the final rule

  • Debt collectors must include a simple and clear means in each text and email to enable consumers to opt out of debt collection communications in that medium.
  • Debt collectors are limited to seven calls to consumers in a seven-day period.
  • After a phone conversation with a consumer, debt collectors should not call again for seven days.
  • The final rule clarifies limitations on the use of newer tech (email, texts, voicemails). Collectors are forbidden from using modern tech to harass or be abusive or to make false representations or engage in unfair practices.
  • Clarifies that consumers aren’t required to use specific words to tell a debt collector that certain times and places are inconvenient for collection communications.
  • Defines a new term the CFPB created: limited-content message. The CFPB the information a collector must include and may include in voicemails.
  • The rule also limits the sale or transfer of debts for collection when a collector knows (or should know) that a debt has been paid, settled or discharged in bankruptcy.

We will have more on the final rule and the application of its provisions in upcoming posts to our Minnesota Consumer Rights Blog. Please check back.