PA 261 BK Law Unit 1 Assignment

Topics: Debt, Fair Debt Collection Practices Act, Federal Trade Commission Pages: 4 (654 words) Published: February 2, 2015


Kaplan University

PA 261 Unit 1 assignment

Jennifer Claire

Creditors and Debtors

The Fair Debt Collection Practices Act, often referred to as the "FDCPA", was passed by Congress due to the massive disputes and complaints in regards to abusive behaviors by collection agencies, and concern that the abuses were the cause of an increase in the number of filings of personal bankruptcies. The purpose of the Act is to provide guidelines for collection agencies which are seeking to collect genuine debts, while additionally providing protection and certain remedies for debtors. The words debt and debt collectors generally invoke fear and anxiety in people, and the topic of money and debt collections is worthwhile and advantageous for everyone to know in detail. According to Robert C. Hobbs, deputy director of Boston's National Consumer Law Center, the overwhelming rise in debt can be attributed to such factors as stagnant personal incomes, rising interest rates, unemployment, identity theft, and Internet fraud. As of Feb 2012, National interest rates were indicative of where consumers stand in terms of debt and high interest; going further into debt: National Average14.91% - Low Interest10.40% - Balance Transfer12.60% Business13.13% - Student13.77% - Cash Back14.45% - Airline14.54% Reward14.73% - Instant Approval15.49%, - Bad Credit23.41% Furthermore, $84,454 is the average household's personal debt, including mortgages, cars loans, credit cards, and other personal debt. One outcome of increased debt has been an explosion of debt-collection agencies, which in turn has resulted in an increased number of criticisms against such agencies. Correspondingly, the changes to the bankruptcy laws of 2005 required debtors filing bankruptcy to attend these classes. The Federal Trade Commission reported 70,951 complaints against debt collectors in 2007, more than six times the number of complaints...
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