(April 23, 2021) In a follow-up to its action last week essentially freezing foreclosures until year’s end, the CFPB this week issued an interim final rule stating that tenants can hold debt collectors (including lawyers) accountable for illegal evictions in the face of a moratorium on such actions outlined by federal health authorities.
Based on the Fair Debt Collection Practices Act (FDCPA), the rule requires debt collectors to provide written notice to tenants of their rights under the eviction moratorium issued by the federal Centers for Disease Control (CDC). The bureau said the rule also prohibits debt collectors from misrepresenting tenants’ eligibility for protection from eviction under the Centers for Disease Control (CDC) moratorium.
Under the rule, CFPB said debt collectors, including attorneys, seeking to evict tenants for non-payment of rent must provide tenants who may have rights under the CDC order with clear and conspicuous written notice of those rights. The notice must be provided on the same date as the eviction notice, or, if no eviction notice is required by law, on the date that the eviction action is filed, the bureau said.
Phone calls or electronic notices such as text messages or emails are not sufficient; the notice must be in writing. Sample language to satisfy the rule’s disclosure requirements is included in the rule, the CFPB said.
The bureau added that its rule does not preempt more protective state laws, which some states (and localities) have adopted to enforce their own eviction moratoria. Debt collectors may also be required to provide notice of these moratoria, the bureau noted.
The rule takes effect May 3 (which the bureau said “will give debt collectors time to come into full compliance.” Debt collectors may begin complying with the rule before the compliance date, the bureau added.
It’s a short comment period for the rule: it ends May 19.