March 12, 2021

CFPB’s Final Debt Collection Rule: What You Need to Know Regarding Electronic Communications

Clients have a lot of questions regarding the CFPB’s Final Rule. While we cannot offer legal advice, Crista Harwood, General Counsel and Chief Compliance Officer at RevSpring, shares her insights regarding questions we received around electronic communications.

1.     What are the frequency limits for email and text communications?

The CFPB did not set frequency limits for email and text communications. However, the general abuse standard does apply.

Inconvenient time and place limitations, outside of 8:00 a.m. to 9:00 p.m. in the consumer’s time zone, apply to all electronic collection communications (text and email). The time zone is determined by the consumer’s zip code and area code. If the zip and area codes differ, then the collection communication can only be sent during the overlap of the permitted hours.

For example, if a consumer’s zip code places the location in the eastern time zone, but the phone number places the location in the pacific time zone, the communication could be sent between 8:00 a.m. PT (11:00 a.m. ET) and 6:00 p.m. PT (9:00 p.m. ET).

Please note, timing is determined by when the communication is sent, not when it is received or scheduled. Additionally, the Final Rule’s commentary explicitly states that text messages or emails, either alone or in combination with other communication types, may result in harassment, and therefore, a violation of the FDCPA.

2.     Are there any restrictions regarding the length of an electronic communication?

There is no limit to the content in the email or text message, but all such collection communications must include related federal or state disclosures.

3.     What are the requirements regarding an Opt-Out?

Each electronic communication must contain a reasonable and simple method that the consumer can use to opt-out of communications and attempts to communicate. The electronic message must contain opt-out instructions that are:

• Clear and conspicuous
• Provide a reasonable and simple opt-out method
• The opt-out cannot be conditioned on payment of a fee or the provision of other information

4.     Are text and email messages subject to the New Rule’s guideline regarding limited-content voice message?

No, text and email messages are not considered limited-content voice messages.

5.     Do I need to obtain consent to use email to send collection communications? Will this form of communication be protected under the Safe Harbor rule?

Yes, you do need to obtain consent to send communications via email. The email communication will qualify under Safe Harbor if you gain consent in one of three ways.

1. Direct consent from the consumer either verbally or in writing.
2. Consent is transferred from the creditor. Additional requirements include:
   • Advance notice to the consumer that their email will be given to the debt collector.
   • The consumer’s email must be a general domain address, such as gmail, yahoo, etc., and not a work email address.
   • Permit the consumer a 35-day opt-out period.

3. Express consent was obtained from the consumer by the immediately prior debt collector and transferred to the next debt collector.

6.     Do I need to obtain consent to use text to send collection communications? Will this form of communication be protected under the Safe Harbor rule?

Yes, you do need to obtain consent to send communications via text. The text communication will qualify under Safe Harbor if you gain consent in one of two ways.

1. Direct consent from the consumer either verbally or in writing.
2. The consumer used the mobile phone number to communicate directly with the debt collector via text.

There are two other items to note as it relates to text messages. First, consent cannot be transferred. There is no safe harbor for transfer from the creditor or the prior debt collector. Also, all phone numbers must be scrubbed every 60 days to ensure the number has not been reassigned.