A September 2021 Bankrate survey showed that 42% of consumers with credit card debt had increased the amounts they owe since the COVID-19 pandemic began in March 2020. In addition, a full one-third of consumers who used “buy now, pay later” options have fallen behind on one or more payments.
The third year of the pandemic is about to begin, and lenders have become less lenient on past-due debts than they were in the early days. And now, creditors and debt collectors have even more ways to contact people whose bills are past due.
A new rule finalized by the Consumer Financial Protection Bureau (CFPB) now permits them to call debtors on the phone up to seven times per week (or more, in certain circumstances) and send unlimited text messages, emails and private social media messages. The rule went into effect on Nov. 30, 2021.
The new rule clarifies how debt collectors can use modern technology in attempts to collect debts owed. It provides guidelines regarding how creditors can use email, text messages and social media to contact consumers — as well as ways for consumers to limit these communications, including the following:
- The debt collector must identify themself.
- Consumers can unsubscribe from emails and stop text messages.
- Social media messages must be private.
There are limits on the number of calls a debt collector can place within a week because of the 1977 Fair Debt Collection Practices Act, which was created to prohibit harassing, abusive and unfair debt collection practices. In addition, consumers can report debt collectors that use abusive, unfair or deceptive practices when collecting debts to the Federal Trade Commission.
Consumer Reports offers several tips for anyone being contacted by debt collectors, including:
- Requesting verification of the debt.
- Obtaining a copy of your credit report.
- Negotiating a lower repayment.
- Not providing your personal information.
The CFPB also provides resources and information to help people protect their finances during the pandemic.
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