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Debt collection in Florida operates under strict rules to protect consumers. Agencies must comply with both federal (FDCPA) and state (FCCPA) laws, which regulate practices like communication times, validation notices, and prohibited behaviors. Florida's FCCPA is broader than federal laws, covering both third-party collectors and original creditors. Agencies must also register with the Florida Office of Financial Regulation and meet licensing requirements, including a $50,000 surety bond. Violations can lead to fines, lawsuits, and reputational damage.
Key points:
Selecting a compliant agency and using technology for portfolio management can help creditors recover debts effectively while staying within legal boundaries.
Florida enforces both the federal Fair Debt Collection Practices Act (FDCPA) and its own stricter Florida Consumer Collection Practices Act (FCCPA). When the two laws conflict, the state law prioritizes the provision that offers greater protection to consumers.
The FCCPA takes a broader approach than the FDCPA, covering both original creditors and third-party collection agencies. This means even businesses collecting their own debts must follow Florida's rules. The act prohibits specific practices like using obscene language, imitating legal or law enforcement documents, and contacting debtors between 9:00 p.m. and 8:00 a.m. without prior consent.
Violating the FCCPA can result in statutory damages of up to $1,000 per action, while class actions are capped at either $500,000 or 1% of the collector's net worth. Unregistered agencies face administrative fines of up to $10,000. Additionally, consumers in Florida have two years to file claims for FCCPA violations, compared to the one-year limit under federal law.
In November 2024, the Southern District of Florida provided clarity on communication rules in Nina Quinn-Davis vs. TrueAccord Corp. (Case No. 1:23-cv-23590-LEIBOWITZ/REID). The court ruled that sending a debt collection email after hours does not automatically violate the FCCPA. According to the decision, "communication" only occurs when the debtor opens and reads the email. The court emphasized that the FCCPA aims to prevent intrusive actions, like disruptive phone calls, rather than unread emails sitting in an inbox.
To avoid violations, agencies should have written "bona fide error" procedures under Section 559.77 as a defense against technical errors. Implementing automated systems to ensure communications occur only between 8:00 a.m. and 9:00 p.m. is also recommended. While the FCCPA provides additional safeguards, the federal FDCPA remains the baseline for compliance, especially for interstate collections.
The FDCPA sets nationwide standards for debt collection practices, focusing on third-party debt collectors and debt buyers. Although Florida’s FCCPA offers broader protections, the FDCPA is still critical for interstate collections and provides minimum requirements for agencies.
Both the FDCPA and FCCPA prohibit false or misleading representations in debt collection. However, the FDCPA does not apply to original creditors unless they engage in deceptive practices.
The FDCPA explicitly allows state laws to offer stronger consumer protections without being considered inconsistent with federal rules. This means Florida debt collectors must adhere to whichever law is more favorable to consumers. Recent updates to the FDCPA clarified that debt collectors are not required to include the "mini-Miranda" warning in formal legal pleadings.
In addition to following these laws, debt collectors in Florida must meet stringent licensing requirements.
Florida mandates that all consumer collection agencies, including those based out of state, register with the Office of Financial Regulation (OFR) before operating within the state. This requirement applies to both consumer and commercial debt collection, even though no equivalent federal rule exists.
The registration process depends on the type of agency. Consumer Collection Agencies (CCAs) must complete Form OFR 559-101 and undergo fingerprinting. However, they can only collect commercial debts if such activity accounts for less than 50% of their revenue. Commercial Collection Agencies (COMs) must use Form OFR-COM-101 and provide a surety bond of at least $300,000 to safeguard creditors.
Applications, updates, and annual renewals are handled through the OFR's Online Services portal. Certain entities, like original creditors, licensed attorneys not primarily engaged in collection, FDIC-insured financial institutions, and licensed real estate or insurance professionals, are exempt from registration requirements. Agencies must verify their registration status before starting operations and comply with record-keeping rules outlined in Rule 69V-180 of the Florida Administrative Code.
Florida Debt Statute of Limitations by Debt Type
In Florida, the statute of limitations sets a specific timeframe for filing debt recovery lawsuits. Once this period expires, debts are considered "time-barred", and creditors can only use non-judicial methods, like calls or letters, to collect. The clock starts ticking from the first missed payment or when the debt is created, shaping how debts are managed and valued.
For consumer debts tied to oral agreements or open accounts - like some credit card debts without formal written agreements - Florida law enforces a four-year statute of limitations. This means creditors must file lawsuits within four years of the last payment or default. Attempting to sue after this period violates both federal and state debt collection laws. For example, in Kimber v. Federal Financial Corp. (668 F.Supp. 1480), the court ruled that pursuing time-barred debts breaches the Fair Debt Collection Practices Act.
Florida has the 10th highest average credit card debt in the U.S., with households carrying an average of $3,340.
Debts grounded in written contracts, such as personal loans, promissory notes, or auto loans, fall under a five-year statute of limitations in Florida. According to Matis Abarbanel, Founding Partner at Loan Lawyers:
The statute of limitations in Florida on debt is five years.
This longer timeframe makes debts based on written agreements more appealing in portfolio acquisitions. For instance, Florida ranks 7th in the country for average auto debt, with households owing $5,580 on average. However, medical debts assigned to third-party collectors are an exception, carrying a shorter three-year limitation period.
Once a debt becomes time-barred, creditors can no longer sue but may still attempt collection through non-judicial methods. However, handling these debts requires care, as certain actions - like a partial payment or a written acknowledgment - can reset the statute of limitations. Agencies must confirm the last payment date to avoid unintentionally reviving the debt.
If a lawsuit is filed on a time-barred debt, the debtor must raise the statute of limitations as a defense, as courts won’t enforce it automatically. While the legal right to sue typically ends after four or five years, the debt can still appear on credit reports for up to seven years under the Fair Credit Reporting Act. Additionally, once a judgment is obtained within the statute of limitations, Florida law allows enforcement for up to 20 years, offering extended opportunities for recovery.
Understanding these deadlines is crucial for developing strategies that comply with Florida law while maximizing debt recovery efforts.
| Debt Type | Statute of Limitations | Reference |
|---|---|---|
| Open Accounts (Credit Cards) | 4 Years | § 95.11(3)(p) |
| Oral Agreements | 4 Years | § 95.11(3)(k) |
| Written Contracts / Promissory Notes | 5 Years | § 95.11(2)(b) |
| Medical Debt (referred to 3rd party) | 3 Years | § 95.11(4)(e) |
| Domestic Judgments | 20 Years | § 95.11(1) |
When choosing a debt collection agency in Florida, it's essential to prioritize compliance, safeguard your reputation, and aim for effective recovery. Florida's strict regulatory framework means working with an unregistered or non-compliant agency could lead to serious legal risks.
Taking these steps ensures a solid foundation for compliance and effective debt recovery.
Selecting the right agency is just the first step. Maintaining compliance and monitoring performance are equally important for a successful partnership.
Incorporating technology into debt management can improve efficiency and ensure compliance, strengthening your partnership with the agency.
| Factor | Consumer Collection Agency | Commercial Collection Agency |
|---|---|---|
| Governing Law | Chapter 559, Part VI | Chapter 559, Part V |
| Registration Fee | $200 | $500 |
| Surety Bond | Not specified | $50,000 |
| Unlicensed Penalty | 1st Degree Misdemeanor | Felony |
| Regulatory Body | Office of Financial Regulation | Office of Financial Regulation |
Florida law places strict limits on how debt collectors can operate. Both the FCCPA and FDCPA explicitly forbid harassment, including the use of profane, obscene, or vulgar language, along with other intimidating tactics. Collectors are also barred from threatening violence, impersonating law enforcement or government agencies, or using attorney stationery to falsely suggest legal representation. Public shaming tactics, like publishing "deadbeat lists" or sending postcards with humiliating labels such as "Deadbeat, Jane Doe", are strictly off-limits.
Debt collectors cannot pursue debts they know to be illegitimate or make false claims about legal rights. They are also prohibited from contacting a debtor's employer about a debt before obtaining a final judgment, unless the debtor has provided written consent. Moreover, agencies must not disclose debt-related information to anyone other than the debtor or their immediate family. Violations of the FCCPA can result in statutory damages of up to $1,000 per incident, along with possible punitive damages and attorney's fees. These rules create a framework for additional regulations on the timing and frequency of debt collector communications.
Florida law also regulates when and how often debt collectors can contact consumers. Collectors are only allowed to reach out between 8 a.m. and 9 p.m. in the debtor's local time zone unless they have prior consent. Regulation F further limits contact by prohibiting more than seven calls about a single debt within seven consecutive days. Additionally, collectors must wait at least seven days after a phone conversation before calling again. A November 2024 ruling in Nina Quinn-Davis vs. TrueAccord Corp. clarified that sending an email after hours does not violate the FCCPA unless the consumer opens and reads it, as the law focuses on disruptive activities like "noisy telephone rings" rather than unopened messages.
Debt collectors are required to send a written validation notice within five days of their first contact with a consumer. This notice must include an itemized breakdown of the debt (covering interest, fees, payments, and credits), the name of the current creditor, and a statement explaining that the debt will be considered valid unless disputed within 30 days. If the consumer disputes the debt in writing during that 30-day period, all collection activities must stop until the collector provides written verification. Additionally, under the FCCPA, if a debt is disputed, collectors are required to inform credit bureaus of the dispute when reporting derogatory information. These guidelines are essential for debt buyers and portfolio managers to ensure their operations remain compliant with the law.
Successfully recovering debt in Florida requires a balance of strict legal compliance and savvy use of technology. To navigate Florida's debt collection landscape, it's crucial to understand the FCCPA, FDCPA, and state-specific regulations. The FCCPA, in particular, applies to both third-party collectors and original creditors, meaning almost all debt recovery efforts must follow rules like restricted communication times and validation requirements.
Before partnering with a collection agency, verify their registration on the OFR portal and ensure they hold the required $50,000 surety bond. Working with unregistered agencies can lead to fines of up to $10,000. Once you’ve confirmed a reliable partner, integrating technology into your strategy can significantly improve efficiency.
Using tools like Debexpert can simplify managing debt portfolios while maintaining compliance. Features such as real-time analytics, secure file sharing, and auction capabilities help you stay on top of statute limitations - 5 years for written contracts and 4 years for oral ones - while also managing contact protocols and documenting communications crucial for FCCPA defense.
To verify if a Florida collection agency is registered, you can check its license through the Florida Office of Financial Regulation (OFR). The OFR provides an official license search tool, allowing you to look up the agency by its name or license number. This step helps confirm that the agency is properly licensed and legally permitted to operate in Florida.
In Florida, the clock on the statute of limitations for a debt can reset under certain conditions. If you make a partial payment on the debt or provide a written acknowledgment of its existence, these actions can legally revive the debt. This means the limitations period starts over from the date of the payment or acknowledgment.
To ensure compliance with the FCCPA and FDCPA, request specific records from the agency, including:
These records should clearly demonstrate the agency's commitment to following both state and federal laws governing debt collection.
More than a decade of Ivan's career has been dedicated to Finance, Banking and Digital Solutions. From these three areas, the idea of a fintech solution called Debepxert was born. He started his career in Big Four consulting and continued in the industry, working as a CFO for publicly traded and digital companies. Ivan came into the debt industry in 2019, when company Debexpert started its first operations. Over the past few years the company, following his lead, has become a technological leader in the US, opened its offices in 10 countries and achieved a record level of sales - 700 debt portfolios per year.
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