Debt Collection & Debt Collectors:
4 Things Every Consumer Needs to Know:
1. Not all debt collectors are the same. Over the past 20 years, "junk" debt buyers have come to dominate the debt collection industry. Debt buyers do NOT issue credit cards or extend credit. Rather, they buy defaulted credit card or loan accounts from banks and credit unions for pennies on the dollar once those banks or credit unions have closed the accounts and charged them off as "bad debts." Different laws apply to debt buyers as opposed to original creditors — and that can significantly impact your rights as a consumer, especially when it comes to debt collection.
2. How old is the debt? If a debt is old enough, it may be past the statute of limitation, meaning, the debt is legally unenforceable in a court of law. But that does not stop debt collectors from trying to collect. Statutes of limitation vary from state to state, and whether the debt is a secured or unsecured debt.
3. New Mexico law requires third-party debt collectors to have a license to collect debts. Under New Mexico law, third-party debt collectors, to include debt buyers, must have a license in order to collect debt. Original creditors seeking to collect their own debts do not need a license.
4. Attorneys must be licensed to practice in the State of New Mexico. Overwhelmingly, the majority of debt buyers are out-of-state entities. They often hire out-of-state law firms to represent them in debt collection lawsuits, who may or may not have attorneys on staff licensed to practice in New Mexico. Attorneys must be licensed to practice in the State of New Mexico or associated with a licensed New Mexico attorney.
Debt Collectors and Your Rights Under the Law
Consumers do have rights under the law. One body of law that regulates the debt collection industry and provides important protections to consumers is the FDCPA. Although the FDCPA only applies to third-party debt collectors and debt collection attorneys, it serves as a model of "best practices" for the entire debt collection industry, including in-house collection departments.
Under the FDCPA, debt collectors cannot call you before 8 a.m. (local time) or after 9 p.m. They cannot call you repeatedly during the course of a day, use profanity or racial epithets, harass, humiliate, or embarrass you. While they can call other individuals to request contact information or inquire about a debtor's whereabouts, they are not allowed to discuss the debt with anyone other than the debtor, a co-debtor, or a debtor's authorized representative.
Other Things Debt Collection Agencies Cannot Legally Do
There are many laws that apply to debt collection activities such as the New Mexico Unfair Practices Act, the federal Telephone Consumer Protection Act, and New Mexico's Collection Agency Regulatory Act. The first two of these laws apply both to third-party debt collectors, attorneys, and in-house collection departments. Along with the FDCPA, these laws stop other collectors from doing the following:
Let Us Help You
If you are being sued or harassed by a debt collector, don’t hesitate to call our law firm today. Our helpful staff and attorney are ready to serve you any time.