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Consumer Debt

American consumers survived the longest and most serious economic downturn since the Great Depression. The housing market is far from healthy, although by most accounts it is trending upward. However, even as the much publicized predatory lending practices of some of our largest mortgage lenders has subsided, credit card collection companies are picking up where they left off. The credit collectors saw the horrible and extreme practices that mortgage lenders were allowed to get away with, and now they're doing the same.

Zombie Debt

One of the favorite practices of collection agencies is resurrecting old debt which the borrower thought was settled or otherwise disposed of. Old debt pops back up from the dead. Sometimes a collection agency will pursue an old debt knowing that the statute of limitations is long past. The hope is that the borrower won't respond to the summons, will fail to appear in court or file an answer to a complaint for debt. If that happens,  the creditor will simply file a motion for default and the debt will be reduced to a judgment. The creditor then sets about seizing assets. It happens everyday in America.

Know Your Rights

Consumers have rights. And the first step in asserting your rights is to know what rights you have. The federal law that governs debt collections is called the Fair Debt and Collection Practices Act (FDCPA). There are a number of specific acts that a creditor is prohibited from doing:

1. Calling before 8:00 am or after 9:00 pm is considered harassment.

2. Demand that you pay more than you owe.

3. Discuss your debt with a third party, such as a family member other than your spouse, or a parent if you are a minor.

4. Make threats if you do not agree to pay the debt.

5. Demand that you pay interest, fees, or expenses that are not allowed by law; or that you did not originally agree to pay.

These are only a few of the actions which a debt collector is prohibited from doing. There are others. You can even sue a creditor for damages if he continues to violate your rights.

Fair Debt Collection Practices Act

If you are in debt, or being harassed by a creditor or collection agency, or need help with document preparation please contact us. We will do our best to refer you to someone who can help.