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Note: The Protective Scope of the Fair Debt Collection Practice Act: Providing Mortgagors the Protection They Deserve from Abusive Foreclosure Practices

By Eric M. Marshall. Full text here.

The Fair Debt Collection Practices Act (FDCPA) is intended to provide consumers broad protection from abusive and harassing practices of debt collectors. However, courts disagree over whether mortgage foreclosure constitutes debt collection under the Act. Several circuit courts hold that mortgage foreclosure is debt collection under the FDCPA, but many district courts view foreclosure as an action distinct from the collection of money and therefore hold that foreclosure is outside the protective scope of the Act. Given the unprecedented rise in mortgage foreclosures over the past two years, it is imperative that courts begin to take a unified approach to interpretation of the FDCPA. This Note argues that courts should uniformly interpret the FDCPA as protective of mortgage foreclosure activities.

The plain language and legislative history of the FDCPA command a broad interpretation of the Act inclusive of home mortgage foreclosure. This interpretation furthers the Act’s broad goal of protecting all consumers from abusive debt collection practices and recognizes that mortgagors are within the class of individuals intended to be protected by the FDCPA. The proposed interpretation further recognizes that satisfaction of debt is a creditor’s true objective in foreclosure. An inclusive interpretation of § 1692f(6) is necessary to support the proposed interpretation of the FDCPA, but such an interpretation is supported by principles of statutory interpretation. The proposed interpretation looks beyond the means used to accomplish debt collection, and in doing so, provides mortgagors the protections they need and to which they are entitled.