In the course of representing Michigan community associations in delinquent assessment collection matters, community association attorneys must be extremely careful to comply with the requirements of the Fair Debt Collection Practices Act (FDCPA). The FDCPA’s purpose is to protect debtors from devious methods of debt collection that may be employed by third party debt collectors, such as threatening to do things that are not allowed under the law (for example, “We’ll take your social security!”)
While the general purpose of the FDCPA is sound, courts throughout the nation have struggled with the question of whether certain actions taken by attorneys in the course of pursuing a lawsuit to collect a debt are subject to the FDCPA. This has resulted in confusion and the opportunity for debtors to challenge valid lawsuits on narrow technicalities, which was never the original purpose of the FDCPA.
H.R. 5082 has passed out of committee and is headed to the U.S. House of Representatives. We support this legislation because it would still require attorneys, including community association attorneys, to adhere to honest debt collection practices, for example, when attorneys communicate with debtors. But it would exclude attorneys from the definition of “debt collector” with respect to taking legal actions like filing suits and collecting on judgments. Attorneys are subject to reasonable ethical requirements imposed on them by their state bar associations, and the FDCPA is not needed for regulation of attorneys’ actions in the litigation process.
Follow this link to the National Creditor’s Bar Association page where you can write to your Representative in support of H.R. 5082.