Question of the Week

Question: Does the federal Fair Debt Collections Practices Act (FDCPA) apply to credit unions collecting on their own debts?

Answer: Generally, no. The definition of debt collector in the FDCPA includes “any person who uses any instrumentality of interstate commerce or mail in any business for the principal purpose of collection of any debts, or who regularly collects or attempts to collect, directly or indirectly, debts owed, due, or asserted to be owed.”

Since we tend to collect our own debts, this would not apply to us.

However, if your credit union collects debts in a name other than the name of the credit union, it would apply, as the FDCPA states that “the term includes any creditor who, in the process of collecting their own debts, uses any name other than their own which would indicate that a third person is collecting or attempting to collect such debts.”