Being Contacted by National Credit Systems? Know Your Rights

Being Contacted by National Credit Systems? Know Your Rights

National Credit Systems, Inc. (“NCS”) is an Atlanta-based collection agency that pursues former tenants over alleged rental debt. It has also been the subject of a federal investigation. In 2022 the Consumer Financial Protection Bureau (CFPB) issued it a compulsory information demand and rejected its attempt to get out of complying. Here’s what to know.

Who Is National Credit Systems?

National Credit Systems mainly collects debts placed by residential landlords and property management companies. These include unpaid rent, lease-break fees, damage charges, and similar amounts that landlords say former tenants owe.

Headquarters: National Credit Systems, Inc., 3800 Camp Creek Pkwy SW, Bldg. 1800-110, Atlanta, GA 30331-6050

Payment/correspondence address: P.O. Box 312125, Atlanta, GA 31131

Phone numbers:

• 1-800-367-1050 (toll-free consumer line)

• (404) 629-9595 and (770) 612-5353 (corporate office)

• 1-800-253-6087 and 1-800-258-5948 (other numbers reported in use for NCS collections)

Former-tenant debt is often disputed. Common reasons include fights over the security deposit, disagreements about damage charges, and debts that were never properly itemized. Before you pay anything, ask for a written, itemized validation notice.

CFPB Enforcement Interest

In 2022, the CFPB issued National Credit Systems a Civil Investigative Demand (CID). A CID is a formal, compulsory request for information that the CFPB uses to investigate possible violations of federal consumer financial law. NCS asked the CFPB to set the CID aside. On October 18, 2022, the CFPB denied that request and ordered NCS to comply in full within 21 days. On February 22, 2023, the CFPB then asked a federal district court for an order requiring NCS to respond.

A CID does not by itself establish wrongdoing. It does show that federal regulators formally investigated National Credit Systems’ practices.

Complaint Volume

The Prado Law Firm reviewed debt collection complaints in the CFPB Consumer Complaint Database from January 2023 to the present. National Credit Systems is one of the higher-volume debt collectors named in those complaints nationally. Other consumer-law resources separately rank it among the most-complained-about collectors for debt collection issues.

Most complaints involve:

• disputes over how much rental debt is claimed, especially move-out damage charges and lease-break fees

• inaccurate reporting of debts to tenant-screening services and credit bureaus

Your Rights Under Federal Law

Under the Fair Debt Collection Practices Act (FDCPA) and related federal law, you have the right to:

• Validation. Get written, itemized validation of the debt, including the amount and the property or lease it relates to. You then have 30 days to dispute it.

• Reasonable contact. Collectors can’t call before 8 a.m. or after 9 p.m. They can’t call you at work once you’ve objected, and they can’t use repeated or harassing call patterns.

• Accurate reporting. Dispute inaccurate rental debt reported to credit bureaus or tenant-screening companies. The Fair Credit Reporting Act gives you this right.

• Ending contact. Demand in writing that the collector stop contacting you.

• Protection from robocalls. The Telephone Consumer Protection Act (TCPA) restricts autodialed and prerecorded calls and texts to your cell phone without your consent.

• Going to court. Sue for statutory and actual damages if a collector breaks these laws. Under the FDCPA, a collector that loses must also pay your attorney’s fees, so these cases usually cost the consumer nothing out of pocket.

What To Do Next

Before you respond to any claim from NCS, pull your original lease and your move-out documents. Many former-tenant disputes turn on whether the landlord followed state law when itemizing deductions from the security deposit. Ask for written validation, and don’t pay until you’ve confirmed the amount is accurate.

You may have a claim if National Credit Systems:

• pursued inflated or undocumented charges

• reported inaccurate information about you to a credit bureau or tenant-screening company

• kept contacting you after you disputed the debt

Contact The Prado Law Firm for a free case review.

Sources

• Consumer Financial Protection Bureau, petition to enforce civil investigative demand (filed Feb. 22, 2023), files.consumerfinance.gov

• CreditProud, “National Credit Systems Collection Agency” (CID denial, Oct. 18, 2022), creditproud.com

• The Cardoza Law Corporation, “National Credit Systems, Inc., Complaints and Lawsuits,” cardozalawcorp.com

• The Kim Law Firm, “National Credit Systems Credit Report Errors,” thekimlawfirmllc.com

• America’s Consumer Lawyer, “Stop National Credit Systems,” agrusslawfirm.com

• Get Out of Debt Guy, “National Credit Systems: Who Are They and Why...,” getoutofdebt.org

• The Prado Law Firm’s analysis of the CFPB Consumer Complaint Database, Debt Collection product, January 2023 to present (source data: consumerfinance.gov/data-research/consumer-complaints/)

This post is for general information only and is not legal advice. Contact The Prado Law Firm to discuss the specifics of your situation.