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Debt Collection Laws in Louisiana

Patrick Austin, J.D. | August 09, 2023

Patrick Austin
Attorney from George Mason
Patrick Austin, JD

Patrick Austin is a licensed attorney with a background in data privacy and information security law. Patrick received his law degree at George Mason University's Antonin Scalia Law School, where he served as the Editor-in-Chief for the National Security Law Journal.

Edited by Hannah Locklear

Hannah Locklear
Editor at SoloSuit
Hannah Locklear, BA

Hannah Locklear is SoloSuit’s Marketing and Impact Manager. With an educational background in Linguistics, Spanish, and International Development from Brigham Young University, Hannah has also worked as a legal support specialist for several years.

Summary: As a Louisiana resident, you can seek refuge in the legal rights and protections afforded under the Louisiana Fair Debt Collection Practices Act, the federal Fair Debt Collection Practices Act, and specific provisions of the Fair Credit Reporting Act, all of which protect you from unruly debt collectors. If you've been sued for debt, SoloSettle is a great way to resolve the lawsuit and settle your debt for good.

Dealing with relentless calls, menacing letters, and intimidation from a deceitful debt collector is an unsettling ordeal. This unnerving experience is familiar to many, including residents of the Bayou State. If you find yourself being pursued by debt collectors, there are legal provisions under both state and federal law designed to protect you while engaging with a collector about a delinquent account.

This article provides a comprehensive overview of debt collection laws in Louisiana, including laws pertaining to the statute of limitations.

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You have legal rights and protections under the Louisiana Fair Debt Collection Practices Act

The Louisiana Fair Debt Collection Practices Act is the state law corollary to the federal Fair Debt Collection Practice Act (FDCPA). This act is found under Louisiana Revised Statutes 9 §9:3562, and it outlines the following rules and regulations for debt collection:

  • Creditors can't contact people who aren't the debtor or don't live in the debtor's household about the debt, except in specific cases.
  • The debtor can allow these contacts by giving consent after the debt is owed.
  • Creditors can contact people to check the debtor's credit info, find the debtor, or if the debtor hasn't paid. If the debtor asks the creditor to stop contacting them in writing, the creditor can only send one notice per month and have limited personal contact.
  • Creditors can still contact people to find the debtor's property, sue for the debt, or contact people the debtor said they could contact.
  • Debtors can still sue for damages under Louisiana law.
  • If a creditor wins a lawsuit, they can contact the debtor again.

It is important to note that the ability to request limited collection correspondence does not prohibit a debt collector from taking further legal action (e.g., filing a debt collection lawsuit) or contacting you in another manner (e.g., phone, social media, etc.).

According to §9:3552 of Louisiana Revised Statutes, if a debt collector in Louisiana breaks the rules by not respecting a request from a consumer to limit their communication, or if they break other rules in the law about debt collection, the consumer can take legal action. If the consumer wins this legal action, they might get back all the extra money they were charged (like loan finance charges or credit service charges). They could even get three times that amount and their attorney's fees paid if they were charged more than they should have been.

Other Louisiana debt collection laws further protect you

Under Louisiana Revised Statutes § 9:3534

  • If you owe money because of something like a credit card or a loan and you don't pay it back, the agreement you signed might say that you have to pay extra money for the costs of hiring a lawyer to collect the debt. This extra money is called "attorney's fees," and it can't be more than twenty-five percent of the unpaid debt.
  • If your creditor hires a debt collection agency to help them collect a debt that you owe, your creditor can't make you pay them back for the fees they give to the collection agency. In other words, they can't ask you to cover the costs of hiring the collection agency to collect your debt.

In essence, these rules safeguard consumers from potentially excessive financial burdens when they're already dealing with the stress of unpaid debts. By understanding these regulations, individuals can be better equipped to manage their financial situations and protect their rights when dealing with creditors and debt collection agencies.

The Fair Debt Collection Practices Act applies to Louisiana residents

The Fair Debt Collection Practices Act (FDCPA) is a federal law governing the practices of debt collectors. In addition, the FDCA provides consumers with notable legal protections against certain predatory and harassing practices. More specifically, a debt collector violates the FDCPA if they:

  • Call you outside 8 a.m. to 9 p.m.
  • Call you at work when it's not allowed by your employer.
  • Tell your family or friends about your debt.
  • Keep contacting you after you've told them not to.
  • Engage in actions that harass or abuse you under the FDCPA.
  • Claim they'll sell your debt to force you to pay.
  • Repeatedly call to annoy you.
  • Don't reveal they're a debt collector.
  • Lie about their identity.
  • Threaten to seize your property.
  • Threaten legal action they won't actually take.

The FDCPA also states that debt collectors are prohibited from using any misleading or deceptive representation in their effort to collect on a debt. In addition, the FDCPA requires debt collectors to substantiate that you actually owe the debt being pursued. For example, you can demand a debt collector issue a debt validation letter confirming you actually owe the debt.

Another way the FDCPA prioritizes consumers is by allowing them to claim monetary compensation from a debt collector who violates the FDCPA. If you can provide proof in court that a debt collector broke the FDCPA rules, you might be eligible to ask for up to $1,000 in damages from that debt collector. This provision in the FDCPA lets consumers seek this compensation without needing to demonstrate actual harm – it's enough to prove the violation occurred.

Apart from the possibility of getting compensation, a court can also make a debt collector who broke the FDCPA rules stop specific collection actions. This is called "injunctive relief." For instance, a court can make the debt collector who violated the FDCPA stop contacting you entirely – this includes both phone calls and letters.

The Fair Credit Reporting Act also applies to Louisiana

In addition to the LFDCPA and FDCPA, consumers have specific rights and protections related to their credit information under the Fair Credit Reporting Act (FCRA). The FCRA is a landmark federal law providing statutory protections to consumers in the context of information reported to the large credit reporting agencies. For example, the FCRA contains the "Furnisher Rule" which governs how and what information a debt collection agent or agency can transmit to a credit reporting agency. The Furnisher Rule places the following requirements on the transmission of information from debt collectors to credit reporting agencies:

  • Debt collectors cannot report information they believe to be untrue or inaccurate or that they've been told is untrue or inaccurate.
  • Debt collectors are required to have policies and procedures in place to verify they are reporting information on the right person (including identifying information).
  • Debt collectors need to notify credit reporting agencies when the reported information is the subject of an active dispute and when an account is changing status from delinquent to closed.

The statute of limitations on debt in Louisiana prevents old debt lawsuits judgments

Apart from the legal safeguards and entitlements outlined by Louisiana state law, the FDCPA, and the FCRA, another important legal framework concerning debt collection is the statute of limitations. This statute sets a specific time duration, usually set by a state's lawmakers, during which something can be used as the basis for a civil claim (like breach of contract, personal injury, debt collection actions, and more). The statute of limitations varies from state to state, including in Louisiana.

The table below outlines Louisiana’s statute of limitations on different types of debt:

Statute of Limitations on Debt in Louisiana

Debt Type Deadline
Credit Card 3 years
Auto Loan 3 years
Student Loan 3 years
Mortgage 3 years
Personal Loan 3 years
Medical 10 years
Judgment 10 years
Source: La. Civ. Code art. 3494, 3499, and 3501

The statute of limitations clock typically begins on the date of your last action on an account, or in other words, the date of your last payment. If the statute of limitations on your debt is already expired, this is going to be your strongest defense in a debt lawsuit. In fact, if you can prove that the statute of limitations is up, the case will almost always be dismissed.

It is your responsibility to bring up the statute of limitations. The judge will not check for you. This is why it’s so important to do your research before agreeing to make any payments to a debt collector, because doing so can restart the clock on the statute of limitations.

Use the statute of limitations as a defense in your debt lawsuit.

Settle your debt in Louisiana

If you know you owe the debt, and the debt is still within the statute of limitations, another option to resolve your debt lawsuit is debt settlement.

In a debt settlement, you offer your creditor a portion of the total amount due, usually at least 60% of the debt’s value. In exchange for a lump-sum payment, the creditor agrees to drop its legal claims against you and release you from the remaining balance.

If you decide to settle your obligation, you’ll want to ensure you get the terms of your agreement in writing and pay the creditor before your court date. If you’ve never tried debt settlement before, consider working with a professional organization that will guide you through the process.

To learn more about how to settle a debt in Louisiana, check out this video:

SoloSettle, powered by SoloSuit, is a tech-based approach to debt settlement. Our software helps you send and receive settlement offers until you reach an agreement with the collector. Once an agreement is reached, we’ll help you manage the settlement documentation and transfer your payment to the creditor or debt collector, helping you keep your financial information private and secure.

Read also: How to Settle a Debt in Louisiana

Notable takeaways

Debt collection laws in Louisiana, and at the federal level passed by Congress, are available to help level the playing field when a consumer is being hounded by an unscrupulous debt collector. Here are some key takeaways on this article on debt collection laws in Louisiana:

  • Debt collection challenges: Dealing with relentless tactics from deceitful debt collectors is distressing for many, especially in Louisiana.
  • Legal protections: Louisiana's Fair Debt Collection Practices Act and the federal FDCPA safeguard consumers from harassment, specifying communication rules and allowing legal action for violations.
  • Consumer rights: Both Acts prevent unfair practices such as revealing debts to others, imposing limits on contact frequency, and allowing compensation for violations.
  • Credit reporting protection: The Fair Credit Reporting Act (FCRA) ensures accurate reporting of debt-related information and provides guidelines for information transmission.
  • Statute of limitations: Louisiana's laws dictate time limits for debt-related legal actions, offering a defense against lawsuits; understanding these limits is essential for protection.
  • Debt settlement might be your best option to resolve your debt lawsuit. You can potentially save money and clear your name of the debt once and for all.

If you’ve been sued for a debt in Louisiana, respond to the case with SoloSuit’s Debt Answer form and increase your chances of winning.

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