Question

Sally uses her credit card to make purchases for her new house. She charges $3500 in one month and repays $2,500 of that amount within one month. She cannot, however, pay the remaining $1000 for about a year. The debt collection partner of her bank calls her repeatedly at all hours. The debt collection agency threatens to seize her property in one week if she fails to repay the outstanding amount along with an unreasonable late fee. In the context of the federal Fair Debt Collection Practices Act (FDCPA), which of the following statements holds true in this scenario?

Multiple Choice

a.The credit card company may use the act to try to recover the money Sally owes it.

b.The debt collection agency may contact Sally’s employer and ask it to garnish her wages.

c.The debt collection agency may call Sally repeatedly during work hours with the intent to harass.

d.The debt collection agency may contact Sally’s employer to get her contact information.

Answer 1

a. The credit card company may use the act to try to recover the money Sally owes it.

As The Fair Debt Collection Practices Act (FDCPA) is a federal law that provides limitations on what debt collectors can do when collecting certain types of debt. The federal Fair Credit Reporting Act covers how debt collection is reported in credit reports. In addition, there are state laws that provide protection.

The Fair Debt Collection Practices Act (FDCPA)

The Fair Debt Collection Practices Act (FDCPA) is the main federal law that governs debt collection practices. The FDCPA prohibits debt collection companies from using abusive, unfair or deceptive practices to collect debts from you.