|Thursday, May 13, 2021|
Floor Schedule and Procedure:
Complete Consideration of H.R. 2547 – Comprehensive Debt Collection Improvement Act (Rep. Waters – Financial Services)
This package includes eight bills and provides important protections for small businesses, servicemembers, students, and other consumers against mistreatment and harassment by certain debt collectors and holds these debt collectors accountable.
Specifically, the bill codifies and expands protections that will help small and minority-owned businesses; prohibits debt collectors from threatening a servicemember with reduction in rank, security clearance revocation, or prosecution; and extends protections for private student loan borrowers with disabilities. The bill also prohibits entities from collecting medical debt or reporting it to a consumer reporting agency without giving the consumer notice about their rights; bans the reporting of medical debt arising from medically necessary procedures; prohibits a debt collector from contacting a consumer electronically without the consumer’s consent; and extends protections in the Fair Debt Collection Practices Act (FDCPA) to debt owed to a federal, state, territory, District of Columbia, or local government agency. The bill clarifies that courts can award injunctive relief for violations of the FDCPA and clarifies that entities in non-judicial foreclosure proceedings are covered by the FDCPA.
Click here for bill text.
Click here for a one-pager from the Financial Services Committee.
Click here for a section-by-section from the Financial Services Committee.
The Rule provides for one hour of general debate equally divided and controlled by the Chair and Ranking Member of the Committee on Financial Services.
The Rule makes in order the following amendments and allows for amendments to be offered en bloc:
Expands requirements debt collectors must meet to take legal action on a debt, including providing advanced notice of commencing legal action, and updates FDCPA to require proof that a debt is legally owed and due. Collection attorneys have been found to violate the FDCPA and harass consumers in numerous cases, and requiring notice before filing a lawsuit may help avoid the need for one by giving the consumer a final opportunity to contact a collector to address an alleged debt.
Provides private student loan borrowers the same protections as federal borrowers, with regards to prohibiting servicers and credit reporting agencies from reporting adverse information during the pandemic, and directs the credit reporting agencies to remove any adverse information since the beginning of the pandemic.
Ensures that debt collectors would not be allowed to contact consumers via social media unless explicitly provided written consent.
Halts enactment of this legislation, and requires the Treasury Secretary to certify that this legislation will not limit the availability of debt products or increase their cost for Americans without a credit history, with poor credit history, or from lower socioeconomic backgrounds. The certification process allows debt collectors to challenge the Secretary’s determination in court, potentially preventing the bill’s protections for servicemembers, students, small businesses, and others from ever taking effect.
Requires the CFPB report to Congress in 6 months analyzing consumer complaint data relating to debt collection practices (including debt collection practices as it relates to medical debt and debts owed by servicemembers) during the pandemic, as well as a list of enforcement actions taken by CFPB relating to debt collection during the pandemic. The report must also outline a strategy on how the CFPB will utilize regulatory, supervisory, and enforcement tools to combat predatory debt collection practices identified during the pandemic, and the CFPB would be required to request debt collectors covered by their larger participant rule provide to the Bureau information about their default judgements pursued through litigation during the pandemic.
Adds language that would explicitly prohibit debt collectors from collecting or attempting to collect debt from consumers where the statute of limitations has expired, and prohibits a debt collector from bringing, or threatening to bring, legal action against any consumer on a debt in which the statute of limitations has expired.
Adds a new section entitled the “Ryan Frascone Memorial Student Loan Relief Act of 2021” to release cosigners of private student loan agreements in the event of the death of the borrower, which will align current law with loans made prior to enactment of the Economic, Growth, Regulatory Relief, and Consumer Protection Act (P.L. 115-174). The amendment also creates the Treasury Loan Purchase Program administered by the Dept. of Treasury that would allow private student loan providers who sustain significant financial injury from releasing cosigners retroactively as provided in the amendment to apply to the Secretary of the Treasury to have the Secretary purchase and retire such loan.
Delays enactment of this legislation, and directs the GAO to study and report to Congress within 1-year about how restricting debt collection will impact low- to moderate income and minority borrowers.
This substitute amendment removes a number of the bill’s protections and replaces it with limited changes regarding the debt collection and credit reporting framework,.
Requires the CFPB to create a page on their website with a consumer bill of rights for abusive debt collectors and resources, as well as directing it to be offered in different languages.
Directs the CFPB to study and report to Congress within 18 months about the consumer experiences and financial impacts of debt collection practices on student loan borrowers with private education loans, and requires an analysis on the practices of private student lenders challenging undue hardship petitions.
Requires the CFPB to report to Congress on the number of people unable to pay a debt because a debt collector is unable to accept a cash payment.
Directs the GAO to (1) analyze the trends and impacts associated with the use of electronic and telephone communications in the debt collection industry, and (2) recommend regulatory and legislative proposals to reduce the annoyance, abuse, and harassment of consumers by debt collectors, including the frequency of electronic and telephone communications by debt collectors to consumers.
Commissions a report that identifies and analyzes racial disparities relating to debt collection practices and provides administrative and legislative recommendations to address such disparities.
Postponed Suspension (1 vote)
1. H.R. 2877 – Behavioral Intervention Guidelines Act of 2021 (Rep. Ferguson – Energy and Commerce)
This bill requires Substance Abuse and Mental Health Services Administration (SAMHSA) to develop best practices for schools to establish behavioral intervention teams and properly train them on how to intervene and avoid inappropriate use of mental health assessments and law enforcement. No later than one year after enactment, best practices shall be made publicly available on a website of the Department of Health and Human Services (HHS).
QUOTE OF THE DAY:
“All literature is protest.”