Iowa Debt Collection Laws

Iowa adheres to the standards of FDCPA in its own Iowa Fair Debt Collection Practices Act. However, the state also has strict guidelines that regulate how debt collectors go about their business. Under the authority of the state attorney general, Iowa does not license debt collectors. However, debt collectors within the state of Iowa who have collected $25,000 in any given year are required to register with the attorney general's office, and to pay an annual $10.00 fee. Furthermore, Iowa law defines "consumer debt" quite broadly; for instance, dishonored checks and accounts based on "90 days same as cash" could fall under this definition.

Debt Collection in Iowa

By law, the debt collection agency must send you a letter within five days of their initial contact, confirming the phone call (or other medium of communication) and the amount of the debt. If you dispute the charges, you must send them a letter via certified mail. The agency has 30 days to respond, and they must provide documentation that you do owe the money specified. By federal and state law, they may not charge more than that amount.

Iowa Statute of Limitations

Other instances involve debts that are expired, according to the statute of limitations in the state of Iowa. These debts no longer have a legally enforceable claim that can be pursued in the courts against a debtor for wage garnishment or other liens. In effect, credit collection companies have no legal recourse to recoup payment from debtors, if the statutes of limitations has expired. The applicable statutes of limitations in the state of Iowa are:

• Judgments from legal cases have a statute of limitations period of no more than twenty (20) years, however, a renewal can be obtained before ten (10) years after the original judgment lapses, but not until after nine (9) years
• Written contracts have a statute of limitations period of ten (10) years following the first breach of the contract
• Open accounts, such as unwritten contracts, incur a statute of limitations period of no more than five (5) years from last date of admission of debt owed
• Deficiency judgments have a statute of limitations period of no more than two (2) years in Iowa

Collections Practices and Rules for Iowa

The state of Iowa follows replicated laws from the federal government concerning debt collection practices and rules. These include consumer protections from harassment, threats, and other forms of intimidation and illegal practices sometimes utilized by debt collection companies. The Attorney General's Consumer Protection Division in Iowa administers complaints regarding debt collection law violations and the regulation of debt collection companies.

Legal Collections Actions

• Legal collection actions can take the form of letters, phone calls, emails, faxes, or even personal contact regarding the collection of a debt, if this is the initial contact
• After initial contact, collection agencies are required by law to mail documents supporting their claims to a given debt, including information regarding the original creditor, the amount owed, and other information relevant to the debt
• Collection actions, such as calls and letters, may continue unless a debtor contacts the collection company instructing them to do otherwise, such as contact their attorney, manage a settlement agreement, or other terms

Illegal Collections Actions

• Any form of harassment, abusive language, threats, implied legal threats with no intention to carry out is illegal. Furthermore, implying a criminal act occurred, implying the collector is a lawyer or government official, or threats regarding wage garnishment, liens, and other civil actions are illegal unless the debt collector has actually taken steps to do so
• Collections attempts cannot occur at an interval or frequency that can be considered harassing by a reasonable person. This would include contact before 8 a.m. and after 9 p.m., unless a debtor has agreed to contact before or after these designated hours
• Consumers can write a letter demanding collection agencies cease contact. Once this letter is received, debt collectors may no longer initiate collections attempts to the consumer unless to inform debtor of taking a specific action
• Contact by debt collectors at a consumer's place of employment is illegal if the collector is informed that the consumer's employer does not approve

Laws for Debt Harassment in Iowa

Should you be contacted by a debt collector, you may wish to see if they are properly registered with the attorney general's office. Further, state law prohibits the agent from issuing threats, using profanity, or otherwise intimidating you. Should they do so, you should document this, the agent's name, and the agency he/she works for. Further, the agent should not contact you before 8:00 am or after 9:00 pm. There are many other laws regarding debt harassment, which include illegal practices known to be used by credit collection agencies in the state of Iowa. Having an attorney represent claims involving harassment is useful in obtaining a favorable resolution, which will undoubtedly include a stop to the harassment, if not other forms of benefits, such as favorable settlements of debts in lieu of filing claims with the Consumer Protection Bureau.

Iowa Debt Negotiation and Settlement Rules

If you do owe, you may request to be put on a payment plan. Most agencies will comply with this request. However, they must agree to a plan that you are able to pay off in a reasonable amount of time. The entire process of debt settlement and negotiation should be overseen by an attorney that specializes in debt settlement cases. In most instances, an attorney can utilize several forms of legal leverage in obtaining favorable settlement terms. Some of the most important aspects of debt settlement that an attorney can look into include:

• Ensuring the veracity of the debt, including the authority of a given debt collection company to collect on a given debt obligation
• Ensuring no illegal or prohibited practices occurred during the collections process or during the settlement agreement
• Addressing settlement terms and agreements, including negotiating the final amount owed, ensuring appropriate reporting to credit agencies, and stopping all collections attempts on a given debt

Help from an Iowa Debt Collection Attorney

Getting a phone call from a debt collection agency is stressful. There is also great potential for fraud. With these things in mind, a lawyer who specializes in debt collection can be quite beneficial. There are many in Iowa, who can help you by putting together a feasible payment plan, and keeping harassing creditors away from you—by law, once your attorney notifies the agency that you now have legal representation, they may no longer contact you directly. For these reasons, hiring an attorney can help you to get out from under debt, and provide peace of mind.