A recent report by the Consumer Financial Protection Bureau took a closer look at the debt collection industry through 2012. The report provides estimations of the nation’s current debt problems, issues surrounding debt collection practices and policy initiatives to improve regulations; the CFPB has been working hard since it first started operating in July of 2011.
Dealing In Debt
Current research shows that nearly 30 million consumers will face debt collections in their lifetime, the average debt to be around $1,500. With such a manageable amount, why are more people experiencing problems with debt collectors? Worse, why do so many of these debt collectors have complaints on file?
From 2008 to 2012, hundreds of thousands of complaints have rolled into the office of the Federal Trade Commission. Reports of harassment, lying about debts owed, threats for seizing assets and illegal pursuit of debts, were among the highest of the complain categories. Although there has been a decline in the number of reports in 2012 compared to the same time in 2011, the FTC attributes much of this trend to improved consumer education.
Consumers are no longer uneducated about their rights in debt collection. More people are engaging in direct debt negotiations, or seeking the help of a bankruptcy attorney to stave off debt collections. Annual reports of service outcomes, progress and current issues is one way in which both the FTC and CFPB are working to continue in their efforts towards improving the industry and increasing the protection of consumers.