Following TRID, the Telephone Consumer Protection Act (TCPA) continues to caution mortgage CxOs. Process, finance, and technology heads felt they already did their bit by investing in loan origination technology to comply with TRID, but TCPA rules are mandating expensive CRM operations. While the penalty for an unsolicited debt-collection call can be as much as $1,500, process and technology changes can save the lenders from new debt-collection rules. Litigation should be avoided as far as possible.
According to the new Act, debt-collection calls require prior written or oral consent before consumers receive them on their wireless devices. The calls can be made only to landlines or telephones if the borrower prefers it that way. It severely restricts the ability of debt collection agencies.
The Federal Communications Commission (FCC) has expanded the definition of “Autodialer” and it includes any phone that automatically dials random or sequential numbers from the lender’s end. Every smartphone at the collection agency’s end will be considered an autodialer and require expressed consent from the consumers.
More needs to be implemented upon the arrival of TCPA rules:
- Pre-recorded telemarketing messages must include an automated interactive opt-out mechanism, and it should be available throughout the duration of the call. Thus, consumers should have the option of dropping the call at any stage of the conversation.
- If consumers invoke the option to unsubscribe, then they should be delegated to the do-not-call list and not called henceforth.
- The recorded telemarketing messages should include a toll-free number to opt out of marketing calls.
The burden of proof of consent falls squarely on debt collectors with the new FCC rules. Mortgage servicers should amend their policies and technologies to mitigate debt-collection calls. There are several means of ensuring consent, like written consent on the 1003 at the loan origination stage or web-based consent when uploading borrower information.
Mortgage servicers should be careful in future, especially about how the new TCPA rules apply. Noncompliance can result in litigation and cause a loss of millions, as autodialers might end up reaching thousands of borrowers without consent.
