(originally published Spring 2003)
In January 2003, pursuant to Assembly Bill 2289, several new laws came into effect in relation to the collection of delinquent assessments. In addition to the federal Fair Debt Collection Practices Act (FDCPA), Senate Bill 1022, which now adds new Civil Code 1812.700, requires any third party who acts as debt collector on behalf of an Association to provide an additional statutory notice which describes the rights of the debtor/delinquent homeowner. A third party is someone who is not employed by the Association, such as a property manager or an attorney, but act as debt collectors.
Effective July 1, 2004, the following notice must be included in the first written correspondence addressed to the debtor in connection with the collection of delinquent assessments and it must be in the same type size that is used to inform the debtor of his/her debt. For some, this may be the Notice of Intent to Lien letter. For others, this may be the ÒreminderÓ letter which may act as the first written notice attempting to collect a debt. Whenever there is an attempt to collect a debt, these letters are normally done in 12-point type and by statute need to include the following exact language:
The state Rosenthal Fair Debt Collection Practices Act and the federal Fair Debt Collection Practices Act require that, except under unusual circumstances, collectors may not contact you before 8 a.m. or after 9:00 p.m. They may not harass you by using threats of violence or arrest or by using obscene language. Collectors may not use false or misleading statements or call you at work if they know or have reason to know that you may not receive personal calls at work. For the most part, collectors may not tell another person, other than your attorney or spouse, about your debt. Collectors may contact another person to confirm your location or enforce a judgment. For more information about debt collection activities, you may contact the Federal Trade Commission at 1-877-FTC-HELP or www.ftc.gov. Those who use ÔreminderÕ letters should consider modifying their letters by removing any language threatening collection action and/or legal action. These letters should only serve as a notice that the account has been assessed a late charge along with a reminder of the due date of assessments.
This new legislation also includes a provision regarding the language used by the third party debt collector. It states that if the language spoken by the debtor in the initial oral contact with the debt collector is other than English, the debt collector must provide the written notice described in this new legislation in the language spoken by the debtor within five (5) working days of the initial oral contact.
If you have any further questions regarding this new law, please feel free to contact our office.