When it comes to running a business, one of the most important aspects is managing finances and ensuring that payments are received on time. Unfortunately, debt collection in Florida is an inevitable part of doing business. For businesses in Florida, understanding the laws and regulations surrounding debt collection is crucial. In this blog post, we will dive into the world of debt collection in Florida and provide businesses with the information they need to know to stay compliant and protect their financial interests.
Debt Collection Laws in Florida
Debt collection laws in Florida are governed by the Florida Consumer Collection Practices Act (FCCPA) and the Fair Debt Collection Practices Act (FDCPA). These laws were put in place to protect consumers from unfair and abusive debt collection practices. However, they also apply to businesses collecting debts from other businesses.
Under the FCCPA, debt collectors are prohibited from using deceptive, abusive, or harassing tactics to collect debts. This includes making false statements, using obscene language, and contacting debtors at unreasonable times. Additionally, debt collectors must provide written validation of the debt within five days of initial contact.
The FDCPA also prohibits similar practices but with stricter guidelines. Debt collectors cannot contact debtors before 8:00 a.m. or after 9:00 p.m., and they cannot contact debtors at their workplace if the employer prohibits it. They are also not allowed to contact third parties, such as family members or neighbors unless it is to obtain the debtor’s contact information.
Statute of Limitations for Debt Collection in Florida
The statute of limitations for debt collection in Florida varies depending on the type of debt. For written contracts, such as credit card debts, the statute of limitations is five years. For oral contracts, it is four years, and for open accounts, such as utility bills, it is four years as well. For judgments, the statute of limitations is 20 years.
Businesses need to be aware of the statute of limitations when attempting to collect a debt. If the statute of limitations has passed, the debt is considered “time-barred” and cannot be legally collected. However, debt collectors may still attempt to collect the debt, and it is up to the debtor to raise the statute of limitations as a defense.
Penalties for Violating Debt Collection Laws in Florida
Businesses that engage in debt collection in Florida must be aware of the consequences of violating debt collection laws. Under the FCCPA, debtors can file a lawsuit against a debt collector for damages, including financial compensation and attorney’s fees. If a business is found to have willfully violated the FCCPA, the damages can be up to $1,000 per violation.
The FDCPA also allows for damages of up to $1,000 per violation, as well as actual damages and attorney’s fees. In addition, businesses that violate the FDCPA may also face fines and penalties from the Federal Trade Commission.
How to Safely Collect Debts in Florida
To avoid any legal issues and maintain a good reputation, businesses must follow proper procedures when collecting debts in Florida. First and foremost, it is essential to understand and comply with the FCCPA and FDCPA. Businesses should also keep detailed records of all communication with debtors and ensure that any written communication includes the required validation notice.
It is also recommended to have a clear and concise debt collection policy in place. This policy should outline the steps for collecting debts and include methods for resolving disputes or complaints from debtors. By having a well-defined policy, businesses can ensure that all employees are following proper procedures and avoid any confusion or misunderstandings.
Dealing with Delinquent Debts
Despite following all the necessary steps, some debts may remain unpaid. In these cases, businesses may need to consider hiring a debt collection agency or pursuing legal action. When hiring a debt collection agency, it is important to do thorough research and select a reputable agency that complies with all state and federal laws.
If legal action is necessary, businesses can seek the assistance of a debt collection attorney. An experienced attorney can guide businesses through the legal process and help them recover the debt owed to them.
Contact Thomas J. Maccari, P.A.
In summary, debt collection in Florida is governed by strict laws and regulations that businesses must follow to avoid legal consequences. Understanding the FCCPA and FDCPA, as well as the statute of limitations for debt collection, is crucial for businesses to protect their financial interests and maintain a positive reputation. By following proper procedures and seeking legal assistance when necessary, businesses can safely and effectively collect debts owed to them.
If your business is struggling with debt collection in Florida, contact Thomas J. Maccari, P.A. at (561) 982-9772 for a consultation.