Debt Collection Agencies Must Prove That Debt Exists

Consumer credit laws are being created in many states that will force debt collection agencies to prove that the debt they purchased for pennies on the dollar exists and the consumer legitimately owes the money. North Carolina recently passed a law this month that requires debt buyers who file a lawsuit to provide documentation proving that they own the debt. In Indiana, there is the Indiana Deceptive Consumer Sales Act prohibits debt collectors from intentionally overstating the amount of the debt they are trying to recover.

National consumer credit laws such as the Fair Debt Collection Practices Act already prohibit collection agencies from harassing, deceptive or unfair practices such as telling neighbors or relatives about what is owed, or calling before 8 a.m. or late at night.

Since the recession started, at least a half-dozen states have adopted additional limits, like imposing statutes of limitations on collections and adding opportunities to punish abusive practices in court. Other states may soon follow suit.

Read the full story here: States adding limits, forcing agencies to prove debt exists – article archived, link removed.