Pennsylvania Debt Collection Laws
In addition to being regulated by the Fair Debt Collection Practices Act (FDCPA), Pennsylvania collection agencies are also regulated by Pennsylvania debt collection laws. Discover: Pennsylvania collection requirements, bad check laws (NSF), statutes of limitations for both debts and judgments, garnishments plus Pennsylvania collection agency license and bonding information.
Summary of the Pennsylvania fair debt collection practices laws:
PENNSYLVANIA INTEREST RATE
PENNSYLVANIA STATUTE OF LIMITATIONS |in years|
Open Accounts: 4
Written Contract: 4
Domestic Judgment: 5 |writ of revival within 5 yrs.|
Foreign Judgment: 4
-Lien against real estate: 5 yrs.
-Personal property Ex: 20 yrs.
PENNSYLVANIA BAD CHECK LAWS |NSF|
After demand and judgment triple damages in amount equal to $1 00 or 3 times the check amount whichever is greater up to $500.
PENNSYLVANIA WAGE GARNISHMENT EXEMPTIONS
100%of wages, certain pensions, retirement accounts & Keogh plan under certain circumstances, and $300.
PENNSYLVANIA COLLECTION AGENCY BONDING and LICENSING REQUIREMENTS
Below is the Pennsylvania debt collection statute:
§ 18 Pa. Cons. Stat. Ann. § 7311. Unlawful collection agency practices
(a) Assignments of claims.–It is lawful for a collection agency, for the purpose of collecting or enforcing the payment thereof, to take an assignment of any such claim from a creditor, if all of the following apply:
(1) The assignment between the creditors and collection agency is in writing.
(2) The original agreement between the creditor and debtor does not prohibit assignments.
(3) The collection agency complies with the act of December 17, 1968 (P.L. 1224, No. 387), known as the Unfair Trade Practices and Consumer Protection Law, [FN1] and with the regulations promulgated under that act.
(b) Appearance for creditor.–It is unlawful for a collection agency to appear for or represent a creditor in any manner whatsoever, but a collection agency, pursuant to subsection (a), may bring legal action on claims assigned to it and not be in violation of subsection (c) if the agency appears by an attorney.
(b.1) Unfair or deceptive collection methods.–It is unlawful for a collector to collect any amount, including any interest, fee, charge or expense incidental to the principal obligation, unless such amount is expressly provided in the agreement creating the debt or is permitted by law.
(c) Furnishing legal services.–It is unlawful for a collection agency to furnish, or offer to furnish legal services, directly or indirectly, or to offer to render or furnish such services within or without this Commonwealth. The forwarding of a claim by a collection agency to an attorney at law, for the purpose of collection, shall not constitute furnishing legal service for the purposes of this subsection.
(d) Services for debtor.–It is unlawful for a collection agency to act for, represent or undertake to render services for any debtor with regard to the proposed settlement or adjustment of the affairs of such debtor, whether such compromise, settlement, or adjustment be made through legal proceedings or otherwise, or to demand, ask for, or receive any compensation for services in connection with the settlement or collection of any claim except from the creditor for whom it has rendered lawful services.
(e) Running for attorneys.–It is unlawful for a collection agency to solicit employment for any attorney at law, whether practicing in this Commonwealth or elsewhere, or to receive from or divide with any such attorney at law any portion of any fee received by such attorney at law. This subsection does not prohibit the established custom of sharing commissions at a commonly accepted rate upon collection of claims between a collection agency and an attorney at law.
(f) Coercion or intimidation.–
(1) It is unlawful for a collection agency to coerce or intimidate any debtor by delivering or mailing any paper or document simulating, or intending to simulate, a summons, warrant, writ, or court process as a means for the collection of a claim, or to threaten legal proceedings against any debtor.
(2) Paragraph (1) of this subsection shall not prohibit:
(i) A collection agency from informing a debtor that if a claim is not paid, it will be referred to an attorney at law for such action as he may deem necessary, without naming a specific attorney.
(ii) A magisterial district judge from sending out notices to debtors before the institution of suit.
(g) Grading.–Whoever violates any of the provisions of this section is guilty of a misdemeanor of the third degree.
(h) Definitions.–As used in this section the following words and phrases shall have the meanings given to them in this subsection:
“Claim.” Includes any claim, demand, account, note, or any other chose in action or liability of any kind whatsoever.
“Collection agency.” A person, other than an attorney at law duly admitted to practice in any court of record in this Commonwealth, who, as a business, enforces, collects, settles, adjusts, or compromises claims, or holds himself out, or offers, as a business, to enforce, collect, settle, adjust, or compromise claims.
“Creditor.” Includes a person having or asserting such a claim.
“Debtor.” Includes any person against whom a claim is asserted.
§ 73 Pa. Cons. Stat. Ann. § 2270
§ § 2270.1. Short title
This act shall be known and may be cited as the Fair Credit Extension Uniformity Act.
§ § 2270.2. Scope of act
This act establishes what shall be considered unfair methods of competition and unfair or deceptive acts or practices with regard to the collection of debts.
§ § 2270.3. Definitions
The following words and phrases when used in this act shall have the meanings given to them in this section unless the context clearly indicates otherwise:
“Communication.” The conveying of information regarding a debt directly or indirectly to any person through any medium.
“Consumer.” A natural person residing in this Commonwealth who owes or is alleged to owe a debt or one who has incurred or is alleged to have incurred liability for the debt within this Commonwealth, including, but not limited to, a comaker, guarantor, surety or parent if the consumer is under 18 years of age. The term includes the consumer’s guardian, executor or administrator.
“Creditor.” A person, including agents, servants or employees conducting business under the name of a creditor and within this Commonwealth, to whom a debt is owed or alleged to be owed.
“Debt.” An actual or alleged past due obligation, claim, demand, note or other similar liability of a consumer to pay money, arising out of a single account as a result of a purchase, lease or loan of goods, services or real or personal property for personal, family or household purposes or as a result of a loan of money or extension of credit which is obtained primarily for personal, family or household purposes, provided, however, that money which is owed or alleged to be owed as a result of a loan secured by a purchase money mortgage on real estate shall not be included within the definition of debt. The term also includes any amount owed as a tax to any political subdivision of this Commonwealth. Tax includes an assessment, any interest, penalty, fee or other amount permitted by law to be collected. Debt does not include any such amount owed to the United States or the Commonwealth.
(1) A person not a creditor conducting business within this Commonwealth, acting on behalf of a creditor, engaging or aiding directly or indirectly in collecting a debt owed or alleged to be owed a creditor or assignee of a creditor.
(2) The term does not include:
(i) Any officer or employee of a creditor while, in the name of the creditor, collecting debts for such creditor.
(ii) A person while attempting to collect a debt on behalf of a creditor, both of whom are related by common ownership or affiliated by corporate control, if the person acting as a debt collector does so only for creditors to whom it is so related or affiliated and if the principal business of the person is not the collection of debts.
(iii) A person while collecting or attempting to collect any debt owed or due or asserted to be owed or due to another to the extent such activity:
(A) is incidental to a bona fide fiduciary obligation or a bona fide escrow arrangement;
(B) concerns a debt which was originated by such person;
(C) concerns a debt which was not in default at the time it was obtained by such person; or
(D) concerns a debt obtained by such person as a secured party in a commercial credit transaction involving the creditor. Persons included within this subparagraph shall be considered creditors and not debt collectors for purposes of this act.
(iv) A person while serving or attempting to serve legal process on another person in connection with the judicial enforcement of a debt.
(v) A person who is an elected or appointed official of any political subdivision of this Commonwealth, who collects or attempts to collect a tax or assessment owed to the political subdivision which employs the person, while that person is acting within the scope of his elected or appointed position or employment.
(3) The term does include:
(i) A creditor who, in the process of collecting his or her own debt, uses a name other than his or her own which would indicate that a third person is collecting or attempting to collect the debt.
(ii) An attorney, whenever such attorney attempts to collect a debt, as herein defined, except in connection with the filing or service of pleadings or discovery or the prosecution of a lawsuit to reduce a debt to judgment.
(iii) A person who sells or offers to sell forms represented to be a collection system, device or scheme which is intended or designed to collect debts.
(iv) A person, other than an elected or appointed official of any political subdivision of this Commonwealth, who collects or attempts to collect a tax or assessment owed to any political subdivision of this Commonwealth.
“Location information.” A consumer’s place of abode and his telephone number at such place or his place of employment.
“State.” Any state, territory or possession of the United States, the District of Columbia, the Commonwealth of Puerto Rico or any political subdivision of any of the above.
§ § 2270.4. Unfair or deceptive acts or practices
(a) By debt collectors.–It shall constitute an unfair or deceptive debt collection act or practice under this act if a debt collector violates any of the provisions of the Fair Debt Collection Practices Act (Public Law 95-109, 15 U.S.C. § 1692 et seq.).
(b) By creditors.–With respect to debt collection activities of creditors in this Commonwealth, it shall constitute an unfair or deceptive debt collection act or practice under this act if a creditor violates any of the following provisions:
(1) Any creditor communicating with any person other than the consumer for the purpose of acquiring location information about the consumer shall:
(i) identify himself, state that he is confirming or correcting location information concerning the consumer, and, only if expressly requested, identify his employer;
(ii) not state that such consumer owes any debt;
(iii) not communicate with any such person more than once unless requested to do so by such person or unless the creditor reasonably believes that the earlier response of such person is erroneous or incomplete and that such person now has correct or complete location information;
(iv) not communicate by postcard;
(v) not use any language or symbol on any envelope or in the contents of any communication effected by the mails or telegram that indicates that the communication relates to the collection of a debt; and
(vi) after the creditor knows the consumer is represented by an attorney with regard to the subject debt and has knowledge of or can readily ascertain such attorney’s name and address, not communicate with any person other than that attorney unless the attorney fails to respond within a reasonable period of time to communication from the creditor.
(2) Without the prior consent of the consumer given directly to the creditor or the express permission of a court of competent jurisdiction, a creditor may not communicate with a consumer in connection with the collection of any debt:
(i) at any unusual time or place or a time or place known or which should be known to be inconvenient to the consumer. In the absence of knowledge of circumstances to the contrary, a creditor shall assume that the convenient time for communicating with a consumer is after 8 a.m. and before 9 p.m. local time at the consumer’s location;
(ii) if the creditor knows the consumer is represented by an attorney with respect to such debt and has knowledge of or can readily ascertain such attorney’s name and address unless the attorney fails to respond within a reasonable period of time to a communication from the creditor or unless the attorney consents to direct communication with the consumer; or
(iii) at the consumer’s place of employment if the creditor knows or has reason to know that the consumer’s employer prohibits the consumer from receiving such communication.
(3) Except as provided in paragraph (1), without the prior consent of the consumer given directly to the creditor or the express permission of a court of competent jurisdiction or as reasonably necessary to effectuate a postjudgment judicial remedy, a creditor may not communicate, in connection with the collection of any debt, with any person other than the consumer, his attorney, a consumer reporting agency if otherwise permitted by law, a debt collector, the attorney of the debt collector or the attorney of the creditor.
(4) A creditor may not engage in any conduct the natural consequence of which is to harass, oppress or abuse any person in connection with the collection of a debt. Without limiting the general application of the foregoing, the following conduct is a violation of this paragraph:
(i) The use or threat of use of violence or other criminal means to harm the physical person, reputation or property of any person.
(ii) The use of obscene or profane language or language the natural consequence of which is to abuse the hearer or reader.
(iii) The publication of a list of consumers who allegedly refuse to pay debts, except to a consumer reporting agency or to persons meeting the requirements of section 1681a(f) or 1681b(a)(3) of the Fair Credit Reporting Act (Public Law 91-508, 15 U.S.C. § 1681 et seq.).
(iv) The advertisement for sale of any debt to coerce payment of the debt.
(v) Causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously with intent to annoy, abuse or harass any person at the called number.
(vi) Except as provided in paragraph (1), the placement of telephone calls without meaningful disclosure of the caller’s identity.
(5) A creditor may not use any false, deceptive or misleading representation or means in connection with the collection of any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this paragraph:
(i) The false representation or implication that the creditor is vouched for, bonded by or affiliated with the United States or any state, including the use of any badge, uniform or facsimile thereof.
(ii) The false representation of the character, amount or legal status of any debt.
(iii) The false representation or implication that any individual is an attorney or that any communication is from an attorney.
(iv) The representation or implication that nonpayment of any debt will result in the arrest or imprisonment of any person or the seizure, attachment or sale of any property of any person unless such action is lawful and the creditor intends to take such action.
(v) The threat to take any action that cannot legally be taken or that is not intended to be taken.
(vi) The false representation or implication that a sale, referral or other transfer of any interest in a debt shall cause the consumer to lose any claim or defense to payment of the debt or become subject to any practice prohibited by this act.
(vii) The false representation or implication that the consumer committed any crime or other conduct in order to disgrace the consumer.
(viii) Communicating or threatening to communicate to any person credit information which is known or which should be known to be false, including the failure to communicate that a debt is disputed.
(ix) The use or distribution of any written communication which simulates or is falsely represented to be a document authorized, issued or approved by any court, official or agency of the United States or any state or which creates a false impression as to its source, authorization or approval.
(x) The use of any false representation or deceptive means to collect or attempt to collect any debt or to obtain information concerning a consumer.
(xi) The false representation or implication that accounts have been turned over to innocent purchasers for value.
(xii) The false representation or implication that documents are legal process.
(xiii) The false representation or implication that documents are not legal process forms or do not require action by the consumer.
(6) A creditor may not use unfair or unconscionable means to collect or attempt to collect any debt. Without limiting the general application of the foregoing, the following conduct is a violation of this paragraph:
(i) The collection of any amount, including any interest, fee, charge or expense incidental to the principal obligation, unless such amount is expressly authorized by the agreement creating the debt or permitted by law.
(ii) The acceptance by a creditor from any person of a check or other payment instrument postdated by more than five days unless such person will be notified in writing of the creditor’s intent to deposit such check or instrument not more than ten nor less than three business days prior to such deposit.
(iii) The solicitation by a creditor of any postdated check or other postdated payment instrument for the purpose of threatening or instituting criminal prosecution.
(iv) Depositing or threatening to deposit any postdated check or other postdated payment instrument prior to the date on such check or instrument.
(v) Causing charges to be made to any person for communications by concealment of the true purpose of the communication. Such charges include, but are not limited to, collect telephone calls and telegram fees.
(vi) Taking or threatening to take any nonjudicial action to effect dispossession or disablement of property if:
(A) there is no present right to possession of the property claimed as collateral through an enforceable security interest;
(B) there is no present intention to take possession of the property; or
(C) the property is exempt by law from such dispossession or disablement .
(vii) Communicating with a consumer regarding a debt by postcard.
(viii) Using any language or symbol, other than the creditor’s address, on any envelope when communicating with a consumer by use of the mails or by telegram, provided that a creditor may use its business name.
(c) Definition.–For the purpose of subsection (b)(2) and (3), the term “consumer” includes the consumer’s spouse, parent (if the consumer is a minor), guardian, executor or administrator.
§ § 2270.5. Enforcement and penalties
(a) Unfair trade practices.–If a debt collector or creditor engages in an unfair or deceptive debt collection act or practice under this act, it shall constitute a violation of the act of December 17, 1968 (P.L. 1224, No. 387), known as the Unfair Trade Practices and Consumer Protection Law. [FN1]
(b) Jurisdiction.–An action to enforce any liability created by this act may be brought in any court of competent jurisdiction in this Commonwealth within two years from the date on which the violation occurs.
(c) Remedies.–Remedies available for violation of this act and the Fair Debt Collection Practices Act (Public Law 95-109, 15 U.S.C. § 1692 et seq.) shall not be cumulative, and debt collectors who violate this act and the Fair Debt Collection Practices Act shall not incur cumulative penalties.
(d) Defenses.–A debt collector or creditor may not be held liable in any action for a violation of this act if the debt collector or creditor shows by a preponderance of the evidence that the violation was both not intentional and:
(1) resulted from a bona fide error, notwithstanding the maintenance of procedures reasonably adapted to avoid any such error; or
(2) resulted from good faith reliance upon incorrect information offered by any person other than an agent, servant or employee of the debt collector or creditor.
§ § 2270.6. Repeal
The provisions of 37 Pa. Code Ch. 303 (relating to debt collection trade practices) are repealed.
Pennsylvania Debt Collection LawsKnowing and abiding to the proper Pennsylvania debt collection laws is important for both creditors and collection agencies alike. There are debtor’s rights attorneys who are just waiting for creditors or collection agencies to slip up. If you mistakenly violate the Pennsylvania debt collection laws, you could create a liability for your business and even open yourself up to a expensive lawsuit.
Please note: Pennsylvania debt collection laws can change over time, and you need to consult with an attorney before you use this information.
Pennsylvania Debt Collection Laws