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Certain states present more challenges for debt collection activities than others, and the District of Columbia (DC) is notably stringent. If you choose to engage in debt collection in DC, ensure that you have comprehensive documentation proving the debt PRIOR to initiating collection efforts. This proof of debt must be ‘in your possession’ in advance, distinct from obtaining documentation from your client if the account is later disputed. Additionally, your initial notice must include a range of required disclosures on its reverse side.
The process can be resource-intensive, demanding that you obtain and verify this documentation from your client before commencing collections.
“No debt collector shall collect or attempt to collect a consumer debt, unless the debt collector has complete and authenticated documentation that the person attempting collection is the owner of the consumer debt, and the debt collector is in possession of the following information or documents:
- Documentation of the name of the original creditor as well as the name of the current creditor or owner of the consumer debt;
- The debtor’s last account number with the original creditor;
- A copy of the signed contract, signed application, or other documents that provide evidence of the consumer’s liability and the terms thereof.
- For a revolving credit account, the most recent monthly statement recording a purchase transaction, last payment, balance transfer, or extension of credit
- The date that the consumer debt was incurred; except, that in the case of a revolving credit account, the date that the consumer debt was incurred shall be; the date of the most recent purchase, payment, balance transfer, or last extension of credit;
- The date and amount of the last payment by the consumer, if applicable;
- An itemized accounting of the amount claimed to be owed, including the amount of the principal; any interest, fees or charges; and whether the charges were imposed by the original creditor, a debt collector, or a subsequent owner of the debt.
- If the consumer debt has been reduced to a judgment, a copy of the judgment as originally issued, complete documentation establishing that the debt collector is the owner of the judgment, and an itemized accounting of the balance due on the judgment.”
DC also mandates that any payment schedule or settlement agreement be documented in writing and sent to the consumer; failure to do so nullifies the agreement’s enforceability. Furthermore, collectors are limited to four phone calls per account within any 7-day period, with exceptions for consumer-initiated calls or responses to consumer requests.
Text messages and emails are also restricted prior to mailing your written notice. Once mailed, one email or text message in a 7-day period is allowed for the purpose of obtaining consent to communicate by such methods. Even after obtaining consent, in DC you are limited to no more than 5 texts or emails per account in any 7-day period unless the consumer agrees to more. Again, except for responses to the consumer’s generated email or text.
The complexity and stringent requirements for documentation in DC contribute to why fewer agencies are willing to handle collections in the district. For additional information on DC debt collection practices, please click here.
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