If enacted, A3131 will significantly change how creditors can interact with debtors in New Jersey. The bill will prohibit practices such as contacting the debtor at unreasonable hours, utilizing threats of violence, or making vague threats about actions that are not actually pursued in the regular course of business. Moreover, creditors will be restricted from using any form of communication that disguises itself as an official legal process, which can mislead the debtor and cause unnecessary distress.
Summary
Assembly Bill A3131, introduced in the New Jersey Legislature, seeks to establish prohibited practices for creditors when attempting to collect debts from individuals. The bill specifically addresses unfair, deceptive, and unreasonable methods that creditors may use during the debt collection process. Practices defined as problematic include communicating about debts in a way that can harass or embarrass the debtor, implying debt to unauthorized individuals, and simulating judicial or law enforcement processes.
Contention
The bill also establishes civil penalties for those who violate its provisions, with first violations incurring a penalty of $2,500 and subsequent violations rising to $5,000. This enforcement mechanism aims to empower consumers by providing a legal avenue to seek damages against creditors who engage in prohibited practices. However, there may be concerns from creditors and debt collection agencies about the implications of these regulations on their standard business practices and the potential challenges in enforcing compliant behavior across varying situations.
Medical debt governing provisions modified, billing and payment established for miscoded health treatments and services, medical debt collecting practices prohibited, and enforcement provided.