Notifying an individual in a collection letter than not paying a debt may have a negative effect on that person’s credit score does not rise to the level of violating the Fair Debt Collection Practices Act, according to a District Court judge in Michigan, especially when the individual’s alleged emotional injury is self-inflicted because she failed to pay the underlying debt in the first place.
A copy of the ruling in the case of Randolph v. Congress Collections can be accessed by clicking here.
The plaintiff received a collection letter which included the following statement:
Once again, I request your careful attention to an overdue balance of $2,075.00 on your account. Your delay to pay this balance may result in negative effect on your credit score, causing you to pay higher interest rates on loans and auto insurance rates in the future
The plaintiff filed suit, alleging the statement violated Sections 1692e and 1692f of the FDCPA because she was unable to prioritize her debts in order to pay the ones with the most risk of negative credit reporting first, was force to spend time and money seeking an attorney to vindicate her rights under the FDCPA, and because she suffered emotional anguish, anxiety, and pain over the possibility of a negative impact on her credit score.
The misrepresentations alleged by the plaintiff are “light years” away from the type of misrepresentations needed to allege a concrete injury, wrote Judge Mark Goldsmith of the District Court for the Eastern District of Michigan. “Randolph does not dispute the amount of the debt, the validity of the debt, or that she owes a debt,” Judge Goldsmith wrote. “Further, Randolph does not allege that Congress Collection made any misrepresentation that could cause her to waive her procedural rights under the FDCPA . Finally, although Randolph alleges — in a conclusory manner — that the letter ‘threatened’ her, a ‘threat’ that her delay in paying the undisputed debt ‘may’ negatively affect her credit score, loan interest rates, and auto insurance rates, is a far cry from a threat of arrest or criminal prosecution.”
Turning to the plaintiff’s claim of emotional anguish and anxiety, Judge Goldsmith noted that the possibility of a future harm is not enough. Especially because she did not dispute the validity of the debt. “…the ultimate cause of Randolph’s anxiety is her own failure to pay her debts and the potential consequences of her delinquency,” Judge Goldsmith wrote.
