This bill, the Comprehensive Debt Collection Improvement Act, would strengthen protections for small business lending, ensure fair debt collection, advocate on behalf of consumers with student and medical debt, end debt collection harassment and abuse, and create guardrails for consumers against private debt collectors. A breakdown of its various provisions can be found below.
This bill’s provisions include language from multiple bills, each of which is listed below with its provisions:
- The Small Business Lending Fairness Act: would amend the Truth in Lending Act (TILA) to restrict the use of confessions of judgment for small business owners and to extend protections that currently exist in consumer lending.
- The Fair Debt Collection Practices for Servicemembers Act: would amend the Fair Debt Collection Practices Act (FDCPA) to prohibit debt collectors from threatening a servicemembers with reducing their rank, having their security clearance revoked, prosecuting them under the Uniform Code of Military Justice, or otherwise communicating with a commanding officer or other senior officer in the chain of command above a servicemember regarding an outstanding debt.
- The Private Loan Disability Discharge Act: would amend the TILA to require the discharge of private student loans if the borrower becomes permanently disabled. This would provide rights that already exist for federal student loan borrowers to private borrowers.
- The Consumer Protections for Medical Debt Collections Act: would bar entities from collecting medical debt or reporting it to a consumer reporting agency without giving a consumer notice about their rights under the FDCPA and Fair Credit Reporting Act (FCRA) related to that debt. These rights include a minimum one-year delay before adverse information is reported to a credit reporting agency and barring the reporting of adverse information relating to medical debt due to medically necessary procedures.
- The Ending Debt Collection Harassment Act: would amend the FDCPA to prohibit debt collectors from contacting consumers via email or text message without the consumer’s consent to be contacted electronically.
- The Stop Debt Collection Abuse Act: would extend FDCPA protections as it relates to debt owed to a federal agency and limit the fees debt collectors can charge. Additionally, this section of the bill would require the Government Accountability Office (GAO) to conduct a study on government agencies’ use of third-party debt collectors.
- The Debt Collection Practices Harmonization Act: would expand the definition of debt covered under the FDCPA to include money owed to a state or local government, clarifying that private debt collectors who pursue debts such as municipal utility bills, tolls, traffic tickets, and court debts are subject to the FDCPA. It would also update monetary penalties for inflation and clarify that courts can reward injunctive relief and add protections to consumers affected by national disasters.
- The Non-Judicial Foreclosure Debt Collection Clarification Act: would reverse the recent Supreme Court decision in Obduskey v. McCarthy and Holthus LLP by amending FDCPA to clarify that entities in non-judicial foreclosure proceedings are covered by the statute.