Consumer Protection, Debt Collection, Pay-to-Pay Fees Are Unfair Debt Collection Practice, 2, 2
Pay-to-pay fees, that is convenience fees a debt collector charges for use of speedy means of payment, such as pay by phone or online payment are an unfair debt collection practice violating 15 USC 1692f(1) because the fees are not expressly authorized by the agreement creating the debt or by state law. A loan servicer is a debt collector under the FDCPA since it collects mortgagors’ regular monthly payments. A debt collector cannot escape section 1692f(1)’s prohibition by claiming it was acting in a separate capacity, and not as a debt collector, in charging the pay-to-pay fee. Rather, the section’s prohibition applies to a debt collector which charges any fee while it is collecting the debt. Section 1692f(1) prohibits collection of any amount. Any means any. There is no statutory basis for limiting the prohibition to charges that are incidental to the debts being collected. See Alexander v. Carrington Mortg. Servs., LLC, 23 F.4th 370, 376 (4th Cir. 2022) (reaching the same conclusion). Because pay-to-pay fees are charged while collecting the debt, they are subject to section 1692f(1) even if separately agreed to by the debtor. Fees are not “permitted by law” unless a state statute expressly permits the “debt collector” to collect the specific amount that it demanded. Lack of statutory prohibition is insufficient.