Debt Consolidation YES!: Debt Collection Abuse

Nationwide Debt Consolidation Services

Debt Consolidation YES!

Home

About Us

Benefits

Savings

Q & A

Free Quote
Reach Us
Consumer Debt

Too much credit card debt? There is a way out!

Call Toll Free:

Debt Collection Abuse: A Real Life Account

A woman received a phone call one afternoon. The caller identified himself as an investigator out of Dallas County. He said a warrant had been issued for her arrest and that she should reveal her location so the investigator could ”take care of this matter before it escalates any further”. Otherwise, he told her, “the police can pull you over and arrest you. They will take you to jail and you will have a lot more problems than you have right now”.

What was her crime? Nothing! It was a scare tactic used by collectors to get her to turn over her car to repossession specialists. She had fallen behind on her car payments when unemployment ran out. Now the collectors were taunting her with threats of arrest and incarceration if she did not surrender the vehicle.

What the collectors did is illegal, not to mention unethical. They lied to her to intimidate and frighten her into surrendering the car. If she had been able to record the conversation as proof of the dialog she could have sued the collectors for $1,000.

There are consumer protection laws to keep unscrupulous collectors from engaging in this type of behavior. What the law permits is clearly defined in the Federal Trade Commission’s rules on Fair Debt Collection Practices Act (FDCPA).

The FTC’s FDCPA rules do not apply to in-house collection agents. The act provides a set of prudent guidelines that are not binding upon original creditors. If you owe money to the hardware store, for instance, the storeowner or the designated store employee is not bound by the rules. However, as soon as the debt is turned over to third party bill collectors for payment then the rules kick in.

1. Collectors may contact you by mail, telegram, email, or fax, but not by post card.
2. You may be contacted by phone between the hours of 8:00am and 9:00pm.
3. You may not be contacted at work unless they have permission. They may not call you at work if you tell the caller that your boss objects to you receiving such calls at the work place
4. They must reveal their true identity. They are not allowed to misrepresent themselves as an agent of the government or credit bureau, and they must give you their true name.
5. Collectors may not threaten you with jail or imply that you have committed a crime. (If you bounce a check, however, that could be a criminal offense in some jurisdictions)
6. The collection agency may not reveal information about you to anyone else besides your attorney. They may seek to collect information about your from others to trace your whereabouts, but they may not tell the informant the purpose of the information collection.
7. The collector may not use verbal abuse including, threatening or profane language or threats of violence.
8. The caller may not threaten to take further legal action against you unless they fully intend to do so. They cannot, for example, tell you they are going to file a suit unless it is legal to do so in your locality.

Judgment and Enforcement by Collectors

If the creditor is unable to collect the debt from you they may consider filing a lawsuit against you in the state court. They may file the case in the state where the transaction occurred, or where they have their main offices.

If the collector wins the lawsuit, the next step is actually collecting for the debt. If you are unwilling or unable to pay the judgment amount, the collection agency can ask for specific remedies that may include:

1. Getting a subpoena to discover your identities, your location, and status of your bank accounts, personal property, employers, income and any other assets.

2. After considering the above information the judge may issue an order of attachment that requires law enforcement to seize and sell your property or other assets to pay the debt.

3. If you are a tenant, the judge may grant the landlord permission to seize certain property, such as furniture, to satisfy the past due rent.

4. A judge may order a garnishment, or deduction of a percentage, of your wages to pay down or eliminate a debt.

Each state has their own rules that govern the relationship between debtors and creditors. You should research the particular relevant laws in your own state that would apply to your situation. Go online at www.ftc.gov/os/statutes/fdcpa/fdcpact.htm, or you may wish to hire an attorney to preserve your rights.

The woman referred to above finally got the collectors to quit harassing her by telling them that she was recording the conversations. The verbally abusive calls stopped. Though she filed a report with the FTC as their website recommends, she only received a form letter stating that until a sufficient number of others filed similar complaints, no action would be taken. For this reason it is often more satisfactory to take matters into your own hands to eliminate the stressful results of insolvency.

1. Tell the caller that you are recording the phone call.

2. Ask them to state their name, address and phone number for the record. At one point our lady above wanted to write her tormentors a cease and desist letter, but they would not provide an address that she could write to.

3. When you get a mailing address from the collector, you can send a return receipt letter and tell them to contact you through your lawyer. Otherwise you may ask them to not contact you further. In this case they can only contact you to inform you of further legal action against you.

4. You may want to in-fact, record phone calls with collectors. If they violate the rules or step over the line you can file a suit with a lawyer. The maximum amount you can recover is $1,000 which is not a lot of money, but it will get them to stop calling you.

Although there are rules that govern collections, only by being aware of them can they be useful to you. Even at that, the law does not always provide enough teeth to enforce its own rules. You have to be your own best advocate. Get in the know.