The Texas Debt Collection Act (Chapter 392 of the Finance Code) is a law that provides Texans with protection against illegal debt collection practices. This law prohibits certain activities and gives consumers the right to seek compensation for damages and financial losses suffered as a result of those violations. In this article, we will discuss the protections provided by the Texas Debt Collection Act, as well as how to recover money for any violations of this law.
In summary, Texans have legal protection against illegal debt collection under the Texas Debt Collection Act (Chapter 392 of the Finance Code). This law makes certain debt collection activities illegal and provides Texans with remedies when the law is violated, including the right to seek damages.
One of the primary protections provided by the Texas Debt Collection Act is protection from harassment. This law prohibits debt collectors from engaging in any form of harassment or abuse, including using threats of violence, obscene language, or continuously calling the debtor with intent to annoy or abuse them. Consumers have the right to seek damages for any violations of this law, and may be able to recover money for emotional distress caused by harassment.
The Texas Debt Collection Act also provides legal recourse for consumers who suffer financial losses due to debt collection activities that are illegal under this law. Examples include making false representation about debts owed or attempting to collect a debt that is not legally enforceable. Consumers can file a complaint with the Office of the Attorney General or in Court and may be able to recover money for any financial losses suffered due to illegal debt collection.
The law also prohibits debt collectors from engaging in unfair or deceptive practices. This includes falsely representing their identity or the amount of a debt owed, as well as failing to provide written notice of debt collection activities.
The Act also provides Texans with protections regarding the disclosure of their debts. This law requires debt collectors to provide a written notice regarding the amount of a debt and the name of the creditor when attempting to collect a debt from a consumer. Additionally, this law prohibits debt collectors from disclosing information about a consumer’s debts to third parties without written permission from the consumer.
Finally, consumers are also protected by this law against improper contact methods employed by debt collectors. This includes collecting or attempting to collect on debts by mail or telephone without prior consent from the consumer, or by contacting the consumer at an inconvenient time.
The Texas Debt Collection Act is a great resource for Texans. It, coupled with the Federal Fair Debt Collection Practices Act, provide protection to consumers and debtors when faced with debts that may or may not be owed.
Harmed by a credit, debt, or repossession problem in Texas or Alabama? John C. Hubbard, LLC represents consumers and injury victims — often with no fee unless we recover for you. If there is no recovery, you owe no attorney’s fee. Whether you are responsible for court costs and case expenses is set out in your written fee agreement before the case begins. Learn more about illegal debt collection, call 205-378-8121 (Alabama) or 832-410-8121 (Texas), or request a free consultation.
The Act reaches original creditors, not just collection agencies
Unlike the federal FDCPA, the Texas Debt Collection Act applies to a creditor collecting its own debt. In Goswick v. Equifax Information Services (W.D. Tex. 2023), an insurer whose account had been opened in the consumer’s name by an identity thief argued it could not be sued under the Act because it was a creditor rather than a debt collector. The court rejected that, holding that what matters is whether the defendant engaged in debt collection, not the label it wears. That makes the Texas Act the right tool when the company pursuing you is the bank, the insurer or the lender itself.
Two other points from the same court. In Reed v. I.Q. Data International (W.D. Tex. 2023), a consumer’s own testimony about emotional distress, reputational harm and financial hardship from a debt she never owed was enough to establish standing and to defeat the collector’s motion for summary judgment. And a collector claiming the bona fide error defense has to prove its error was unintentional; the court refused to accept the claim on the collector’s say-so.