A Law firm sent a letter to Mortgagors informing them that they were in default and that the Mortgagee had accelerated all sums due. The letter also advised that the law firm was attempting to “collect a debt,” but it was seeking solely to “foreclose the creditor’s lien on real estate” as the law firm “will not be seeking a personal money judgment against you.” The Trial Court dismissed in part on the premise that a foreclosure action failed to qualify as debt collection under the FDCPA.

The Appellate Court found the note was related to the collection of the debt and the mortgage. Thus, it was subject to FDCPA.  The Court relied on precedent find that a letter providing notice of a pending foreclosure functions to enforce both the note and security interest was subject to the FDCPA.  The fact that a letter related to enforcement of a security interest did not prevent it from simultaneously relating to the collection of a debt. The Appellate Court reversed and remanded.

 

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