No unfair collection tactics, including improper foreclosure threats

A debt collector may not use unfair or unconscionable means to collect. It cannot collect fees or charges that your loan contract or the law does not allow. It also cannot take or threaten to take your property through a non-court process when it has no present right to it, no real intention to take it, or the property is legally exempt.

Consumers contacted by a "debt collector" about a personal, family or household debt — including many foreclosure law firms and servicers that took over a loan after it was already in default.

• Only if a debt collector is involved.
• The rule against improper property-taking (§ 1692f(6)) also reaches companies whose main business is enforcing security interests, like many foreclosure trustees.

• Question fees in a payoff or reinstatement quote

  Ask for an itemized breakdown and the contract term or law that allows each fee.

  Open the tool

• Build your file

  Collect notices, fee statements and the loan documents to show what was allowed.

  Open the tool

• A firm doing only nonjudicial foreclosure is covered by § 1692f(6) but generally not by the rest of the FDCPA (Obduskey).
• If the creditor really has a right to foreclose, a foreclosure that follows state law is not an FDCPA violation by itself.
• A lawsuit under the FDCPA must be filed within one year of the violation.
• This is general legal information, not legal advice, and it does not promise any result. A HUD-approved housing counselor or a lawyer can look at your facts.

1. Federal lawFDCPA — unfair practices

   15 U.S.C. § 1692f

   What it says: A debt collector may not use unfair or unconscionable means to collect any debt.

   Read the official texthttps://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1692f&num=0&edition=prelim
2. Federal lawFDCPA — unauthorized amounts

   15 U.S.C. § 1692f(1)

   Exact part: (1)

   What it says: Collecting any amount not expressly authorized by the agreement or permitted by law is unfair.

   Read the official texthttps://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1692f&num=0&edition=prelim
3. Federal lawFDCPA — nonjudicial dispossession

   15 U.S.C. § 1692f(6)

   Exact part: (6)

   What it says: Taking or threatening nonjudicial action to take property is unfair if there is no present right to possession, no intent to take it, or the property is exempt.

   Read the official texthttps://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1692f&num=0&edition=prelim
4. Federal lawFDCPA — who is a "debt collector"

   15 U.S.C. § 1692a(6)

   Exact part: (6)

   What it says: Defines who is a debt collector, and excludes, among others, anyone collecting a debt that was not in default when they obtained it.

   Read the official texthttps://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1692a&num=0&edition=prelim
5. Court decisionObduskey — nonjudicial foreclosure firms

   Obduskey v. McCarthy & Holthus LLP, 586 U.S. 466 (2019)

   What it says: A business engaged only in nonjudicial foreclosure is not a "debt collector," except for § 1692f(6).

   Read the official texthttps://www.law.cornell.edu/supremecourt/text/17-1307
6. Federal lawFDCPA — civil liability

   15 U.S.C. § 1692k

   What it says: A debt collector who violates the Act is liable for actual damages, statutory damages up to $1,000, and attorney's fees; suits must be filed within one year.

   Read the official texthttps://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title15-section1692k&num=0&edition=prelim

• Homeowner lostCited for this right
  Obduskey v. McCarthy & Holthus LLP

  Obduskey v. McCarthy & Holthus LLP, 586 U.S. 466 (2019)

  a business engaged only in non-judicial foreclosure is not a debt collector under the FDCPA, apart from the provision barring threats to take property without a present right

• Homeowner wonCited for this right
  Heintz v. Jenkins

  Heintz v. Jenkins, 514 U.S. 291 (1995)

  the FDCPA applies to lawyers who regularly collect consumer debts, even through litigation

• Homeowner wonSame topic
  Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich, L.P.A.

  Jerman v. Carlisle, McNellie, Rini, Kramer & Ulrich, L.P.A., 559 U.S. 573 (2010)

  the FDCPA's bona fide error defense does not excuse a debt collector's incorrect interpretation of what the Act requires

• Homeowner lostSame topic
  Boren v. U.S. National Bank Ass'n

  Boren v. U.S. Nat'l Bank Ass'n, 807 F.3d 99 (5th Cir. 2015)

  a lender may abandon a prior acceleration by giving notice that it seeks less than the full accelerated balance, which restarts the four-year limitations period

• Homeowner lostSame topic
  Martins v. BAC Home Loans Servicing, L.P.

  Martins v. BAC Home Loans Servicing, L.P., 722 F.3d 249 (5th Cir. 2013)

  a mortgage servicer acting for a properly assigned mortgagee may foreclose in Texas without possessing the original note, and an oral promise to modify a large loan is not enforceable

• Partial winSame topic
  Reinagel v. Deutsche Bank National Trust Co.

  Reinagel v. Deutsche Bank Nat'l Tr. Co., 735 F.3d 220 (5th Cir. 2013)

  a Texas borrower may challenge an assignment of the loan on any ground that renders it void, though not on grounds that make it merely voidable

• Partial winSame topic
  Culhane v. Aurora Loan Services

  Culhane v. Aurora Loan Servs., 708 F.3d 282 (1st Cir. 2013)

  a mortgagor may contest the validity of a MERS assignment to the foreclosing entity, although the MERS framework itself is lawful

• Homeowner wonSame topic
  Kaltenbach v. Richards

  Kaltenbach v. Richards, 464 F.3d 524 (5th Cir. 2006)

  a person who meets the FDCPA's general definition of debt collector is subject to the whole Act even while enforcing a security interest