On Thursday, July 2, the Consumer Financial Protection Bureau (CFPB) announced that it plans to publish final debt collection rules in October 2020. The final rules will be the first rules clarifying the nearly 40-year-old Fair Debt Collection Practices Act (FDCPA) and are expected to address a variety of topics including:
- Communications with borrowers;
- Guidance on what constitutes harassment or abuse, false or misleading representations, and unfair practices; and
- Disclosures (including time-barred debt disclosures).
In the proposed rule that was published in May 2019, the CFPB proposed a one-year implementation before the debt collection rules would become effective. If they incorporate the same implementation period in the final rule so that it becomes effective one year after publication in the Federal Register, it likely could become effective as early as October or November 2021.
As we have previously discussed, the CFPB’s debt collection rulemaking process, which started in 2013, has evolved over time. However, we expect that the bureau, after its seven-year-long rulemaking process, will largely stick with the proposed debt collection rules that it published in May 2019 and the supplemental proposal regarding time-barred debt disclosures that it issued earlier this year.
