Articles Tagged with Debt Collectors

FTC logo      If you are getting debt collection calls you are not alone. About one in seven people in Mississippi is being hounded by a debt collector. Buying debt and debt collection is a billion dollar business and becoming a larger, more complex industry. The original creditor sells their debt to a debt collector, and often they sell the same debt multiple times meaning that multiple debt collection companies are attempting to collect the same debt! Debt collectors often attempt to collect from the wrong person, overstate or inflate the amount owed by adding collection fees, and even attempt to collect debts that are not real (may have been paid in the past or was never a debt to begin with).
Along with these abuses, details of the original debt are lost or outdated. Creditors selling debt are basically selling lists that have contact information and amounts owed – and little more than that in way of details.  Collectors then may have a mixture of valid debts, debts that have been since settled, or debts that are past the statute of limitations and can no longer be collected. It’s not clear exactly how many consumers are wrongly harassed for accounts that are not their debt. Debts purchased by the large debt-buying firms have no documents, contracts or other proof of the debt. Your debt will be sold to a debt collector for pennies on the dollar. It’s not just the original credit that sells debt.  Debt collection companies then may sell the lists they have purchased to other debt collectors, who may then sell it to another, then another, and another. It’s not uncommon for people to all of a sudden be receiving debt collection calls and letters about something that happened years ago but now, the debt has shown up on a list that has been sold to another company, and here we go again. Continue Reading ›

stop calls      First realize that you do not have to talk with the debt collectors when they call. They are not calling because they care about your situation or want to discuss your financial problems in order to help you find a solution. They want a payment, or a promise to pay, and unless you are able to give one of these things to them, there is no reason to talk. If you had the money, you would have already paid them, and if you had the money coming in, you would have already made arrangements (a promise) to pay.  They know this so they call, and call, and call, and call – thinking that the more they harass you, belittle you, etc – the more likely you are to figure out a way to pay them – they don’t care about you being able to figure out an overall solution, just that you meet their immediate demand regardless of the cost to you.  Who gets fed? Usually it’s the loudest chirping bird.  Debt collectors don’t care if all you have is the money to pay your house note – they want to be paid and the house note not getting the money is your problem. You don’t have to talk to people like this.
Keep in mind that a debt collector is required to mail you what’s called a “validation” notice within five days of first contacting you. This notice must include and lay out the amount they claim owe, the name of the creditor that they claim you owe, and what to do if you think you don’t owe this money. You then have 30 days to dispute this debt and it’s claims. You also have the right to notify them that you do not want them to call or contact you anymore. It is best that you do this in writing and send it by certified mail so you have proof of your notification to them to stop contacting you, should they continue to call.  Click here to read more about stopping debt collectors from calling.

If you get served with court papers, you are being sued by someone (person or business entity).  For the sake of this discussion, let’s say you are being sued by a creditor over a debt you did not pay (or they say you did not pay). If you don’t show up for court, the debt collector wins, right or wrong – they win and get a judgment is set against you. With a judgment in place, the debt collector has the power to garnish your wages or seize your bank account, or any bank account with your name on it.

They can sue you and garnish your wages even if they have already repossessed their collateral (such as a car, furniture, guns, etc).  They can sue you and garnish your wages even if they have foreclosed on your home if they say that there is a delinquency (the sale of the home, car, furniture, guns, etc) did not cover the entire balance you owed the creditor.

Don’t avoid being served. The 14th Amendment to the US Constitution mandates “due process” when someone is asserting a claim against a person’s “life, liberty or property.” State Constitutions have also adopted this right and passed what is called “service of process” laws that spell out how a legal document must be delivered to a defendant in a lawsuit.  Don’t make the mistake of thinking that avoiding being served will avoid the consequences of being sued. It is just not true. Avoiding being served does not make the case disappear and avoiding being served could make things worse.

Yes, you can stop debt collectors from calling you. Federal law, the Fair Debt Collection Practices Act, (“FDCPA”) requires debt collectors to stop calling if you send them a written request. Once your written notice for telephone calls to stop has been received by a debt collector, financial penalties of $500 to $1,500 can be awarded per violation.

What You Need To Do To Stop Debt Collection Calls:

    1. Write a letter setting out your name and address.

The Fair Debt Collection Practices Act (FDCPA) prohibits abusive and deceptive collection tactics. This means that the debt collectors cannot insult you, threaten you, trick you, lie to you, or harass you with phone calls at all hours. This law applies only to third-party debt collectors and does not apply to a creditor collecting their own debt.
If you feel you a debt collector is being abusive, you can sue them under the FDCPA. Mississippi has zero consumer protection laws and there is no regulation of debt collectors. Creditors collecting their own debts are free to abuse you in Mississippi. You can complain to the state attorney general’s office if it makes you feel better, but don’t expect anything to come out of it.  But you can stop the calls – click here to find out how. And you have options on how to deal with your debt overall – I can help.

credit cardsCan you pay your credit cards after filing bankruptcy?  Of course. You can pay anyone you want to pay. But should you? Let’s explore whether first of all you can keep them, and second if you have anything to gain by paying debts that were wiped out by the bankruptcy court…

Can you keep your credit cards after filing bankruptcy?  You should know that your credit cards will be canceled by the creditor once you file bankruptcy.  Even if you want to keep them and continue to pay, they will be canceled.  Credit card companies are constantly checking your credit reports and the moment they see the bankruptcy they will cancel the card.  This is a surprise to many people who thought that by not listing one or two cards in their bankruptcy, they could keep using them.  No company is going to let you keep a credit card. They all want you to reaffirm the debt and pay it off, but they will not extend the current credit privileges, even if you agree to pay what is owed. Now after filing bankruptcy, you may get flooded with new offers for credit cards (some offers may even be from the same companies!) but they will not allow the current account to remain open.

Why? Once a debt is discharged in bankruptcy, the creditor can’t have any contact with you. No letters, no phone calls, no law suits, no efforts to collect, and no reports to the credit bureau. You can sue them if they violate these rules. So if you repay the debt, the creditor can’t and won’t report it on your credit record. They will take the money, but you won’t any recognition or credit for paying it.

NO!!!  The lender cannot threaten or use criminal prosecution to collect.  However, the lender may file an action against you in civil court.  If you cannot repay the loan, you may request that the lender place you on a payment plan.  However, the lender is not legally required to grant your request.  If you wish to file a complaint regarding a payday loan vendor in Mississippi, please call either or both of the following offices:

Department of Banking & Consumer Finance – 1.800.844.2499

Consumer Protection Division of the Office of the Attorney General – 1.800.281.4418

Most of my clients come to me after a garnishment has been sent to their job. A few come to see me as soon as they are served with the lawsuit.  I wish they would come to see me on the day they get sued, but that is not always practical.

If you get sued or served with papers trying to collect a debt there are several things you can do.

1) Ignore everything and hope it goes away.

I have been flooded with inquiries from people in the Jackson, Pearl, Brandon, and Madison cities of the metropolitan area who have been scared to death by collection agencies.  The caller usually claims to be a detective or some sort of officer and states that they are on their way to your house to take you into custody unless you pay your balance in full immediately.  They state they must have the payment over the phone – no option to mail in a payment, etc.  This is all a ruse to gain entry into your bank accounts.
People, listen up. YOU DO NOT GO TO JAIL FOR FAILURE TO PAY AN ORDINARY DEBT.  Don’t be scared by these tactics. It’s simply lies to get you to hand over money.  Do not give them any details about yourself.  They may have some info about you and even the name of a company you owe, etc but even if you are indebted to the company, it is illegal for bill collectors and collection agencies to threaten you with possible arrest. You can go to jail for not paying child support or court fines but not for regular and ordinary debts.

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