Texts, Emails and Direct Messages from Debt Collectors Are Now Allowed — What to Know

Consumers will have the option to opt out of any electronic messages they may receive, according to the Consumer Finance Protection Bureau

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Debt collectors are now allowed to text, email and direct message individuals on social media to seek repayment, according to the Consumer Finance Protection Bureau.

Under the new Fair Debt Collection Practices Act rules, when went into effect on Tuesday, debt collectors are permitted to contact consumers via these communication methods so long as they provide an option to opt out.

Messages between consumers and debt collectors online must also remain private, meaning companies may not post on individual social media pages should they be visible to the public.

"With this modernized debt collection rule, consumers will have greater control when communicating with debt collectors," said Kathleen Kraninger, then-director of the Consumer Financial Protection Bureau when the rule was announced in October 2020.

When contacting an individual about a debt, collectors are required to provide details about the consumer's debt and their rights in addition to contact information, according to the act. Debt collectors must also attempt to inform a consumer about a debt before they can report their information to a consumer reporting agency.

In addition to classic methods such as reaching out by telephone or mail, debt collectors may now utilize electronic messaging to reach consumers. They must also "wait a reasonable period of time" before informing a consumer reporting agency about the debt unless a notice of undeliverability is received by the collector, according to the bureau.

Additionally, debt collectors may not contact consumers more than seven times in seven days regarding an outstanding debt.

In an October blog post, Kraninger said the new rules will help debt collectors and consumers alike that have been "trapped in a time warp."

"We are finally leaving 1977 behind and developing a debt collection system that works for consumers and industry in the modern world," wrote Kraninger, who resigned from her previous role in January.

However, some critics are expressing concern for consumers as the new rules take effect. April Kuehnhoff, a staff attorney at the National Consumer Law Center, told NPR that the new rules "are really disappointing and concerning in a number of ways."

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Per NPR, the concerns include the inability to opt out of the electronic messaging, rather than opt in, and those who do not regularly check their social media or email accounts, some due to a lack of internet access.

Kuehnhoff is also concerned about opening up a new way for criminals to scam consumers out of money.

"I have actually already gotten my first spam debt collection email even before the new rules took effect," she told NPR. "So certainly we should anticipate more bad actors who are trying to scam people into paying them money on alleged debts."

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