Compliance Workbook: Letters

Collection letters to consumers remain a staple of the debt collection cycle. They are also, as Caren Enloe of Smith Debnam points out, kryptonite for collection agencies, too. They are:

• Easy to Prove
  
• Legion -- You Send Them A LOT
  
• Class Action Fodder
  

Letters are complex interplay among your agency, your letter vendors, and the Fair Debt Collection Practices Act – specifically between §§1692g and 1692e.

This workbook will walk you through some strategies. It includes:

• Introduction to 1692g and 1692e
  
• Third-Party Consent Management Whitepaper
• Debt Verification Policy & Procedure Template
• Written & Electronic Communication Review Policy Template
• Webinar Q&A
• Webinar Slide Deck

Webinar Q&A

• What items, beyond the 1692g list, could be misrepresented in 1692e?
  
• If the first contact is oral and the debt is paid in full, should the g notice still be sent?
• You suggest not messing with the 1692g language, which I call good advice.  But doesn't the Homer case say that you MUST become creative with the 1692g language?
• As to stating the amount of interests and fees, it is sufficient to attach to the demand the underlying contract which has the full terms of the agreement?
• What is the name of the case where it was discussed that the original creditor use other servicers prior to chargeoff that accrued interest on the debt, but once charged off the client did not include the same amount in their letters?
• With medical debt "late charges" may also mean charges submitted by a department to the bill after the original bill is generated. This may result in a higher amount than the origian billed amount. Would you suggest the medical service provider provide "late charges" as defined here, on a separate "bill" for collection?
• Would "Offer In Compromise" be an acceptable alternative method of stating "settlement"?
• What if the balance doesn't have any interest accruing pre- judgment but later suit is filed and the Court awards judgment with post judgment interest?
• Are initial lenders also held to the SOL language for letters?
• What about the word important? (EX: COLLECTION NOTICE - IMPORTANT)
• On giving a longer deadline, I worry about cases where the debt collector gave the consumer broader rights (i.e., told the consumer that it could dispute the debt orally) & the court concluded that the debt collector was deceiving the consumer because the statute required a written dispute--even though the debt collector proved that it would honor a written dispute.
• Do you consider the word "settlement" to be dangerous language on any notice; not just the initial demand?  In particular, on a client that does not allow any type of suit on their accounts?
• Do you need to state the address to which payment should be sent?
• Would it be ok to use the word settlement if you have a judgment for the debt owed?