Here’s what you should know about the CFPB’s new debt collection rule

Thursday, November 18, 2021

Debt collectors can soon contact you by text and through social media.

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Big changes are coming to the federal rule that regulates debt collection practices, and the update will impact the nearly 70 million Americans who have a debt in collections. Even consumers with debts that are beyond the statute of limitations can be pursued under the new rule, and those without debts in collections must beware of scammers who are using the newly allowed communication channels as a way to confuse and defraud consumers.

The Consumer Financial Protection Bureau's (CFPB) update to the federal Fair Debt Collection Practices Act takes effect on Nov. 30, 2021. Here's what you should know:

Phone calls

Under the new rule, debt collectors are allowed seven attempted calls, or one conversation, per week—per debt. This could amount to a lot of calls, since many consumers who are struggling to pay their bills typically owe money on more than one bill. Collectors can only contact you between 8 a.m. and 9 p.m. local time, and they cannot contact you at work once you’ve asked them not to. If you ask them to stop contacting you by phone, the debt collector must comply (though they can attempt to reach you in other ways in the future).

Emails and text messages

There is no limit on the number of text messages or emails a debt collector can send, though they are prohibited from sending emails to known business addresses. Messages must be sent at a reasonable time (similar to the 8 a.m. to 9 p.m. limitation for phone calls) and every message must include instructions on how to opt out from receiving those types of messages again if you no longer wish to communicate in that way.

Social media direct messages

A debt collector can send you private messages via your social media accounts, like Instagram and Facebook, but cannot post anything that friends, followers or the public can see. The messages must contain information on how to opt out from receiving further communications via social media.

Don’t start paying old (“time-barred”) debts

In most states, debt collectors have a limited number of years they can sue you to collect a debt—called the “statute of limitations.” Once that time expires, the debt becomes “time-barred,” or too old to sue you for. Most state statutes of limitations range from three to 10 years. (Check your state here.)

Don’t make a payment on time-barred debts—it can restart the clock and revive the collector’s ability to sue you. Debt collectors are prohibited from suing or threatening to sue on time-barred consumer debts via the new rule, but, in some states, they can sue if a borrower revives the statute of limitations through a partial payment after being pressured by a debt collector.

Avoid scams

Avoid clicking links or opening attachments in messages from unknown senders. Research the debt collection company’s name to verify that it is a legitimate business before communicating with the collector. Legitimate debt collectors must send you proof that you owe the debt (such as a copy of the original bill owed to the creditor). If a collector continues to hound you after you’ve asked for, but not received, a verification notice that explains what the debt is and how much you owe, chances are it’s a scam.

How to opt out

The collector must include a “reasonable and simple” method to opt out of electronic communications. Although the debt collector gets to choose the method to opt out, consumers should be careful if the opt-out method asks them to click on a link or download anything. Instead, we suggest:

• By text: Reply STOP to a text.
• By email: Reply STOP in the subject line of an email.
• By phone or in writing: Consumers can tell a collector to stop one or more types of communication by communicating with the collector by phone, by mail, or via any method of electronic communication used by the debt collector to communicate with consumers. For example, the consumer can say: Stop emailing me, calling me, texting me, etc. Consumers can also indicate that a collector should not use a particular phone number or email address. 

Note: Consumers can use words such as “quit,” “end,” “unsubscribe” and “cancel,” or other words that make the point.

Stop all communication

You can choose to opt out of receiving any further communications from a debt collector, but doing so means you will not receive updates on the status of your debt in the future. If you choose to stop all communication, you must do so with each individual debt collector.

Where to complain

If a debt collector doesn’t follow the opt-out instructions you’ve provided or harasses you, you should:

• File a complaint with the CFPB
• File a complaint with the FTC
• Contact your state attorney general’s office

More information

For more information about the changes to the FDCPA and how the new rule could affect you, read our Debt Collection issue of Consumer Action News.