Archive for Debt Collections
Can a Collection Agency Threaten?
Posted by: | Comments
Can a Collection Agency Threaten?
By Greg Artim
Collection agency threats are about as common as oxygen being in the air. To begin, they legally cannot “threaten” to do anything that is illegal, and they cannot “threaten” to take an action that they do not intend to actually take.
The biggest threat that I hear about is wage garnishment. To start, let’s be absolutely clear on this, wage garnishment cannot happen in Pennsylvania except under very limited circumstances. Generally, I can say that a collection agency lawsuit will not meet with those very limited circumstances. In that regard, any threat to garnish wages in PA by a collection agency is illegal because they simply cannot garnish wages here in Pennsylvania.
Another big threat that I hear is that they’re going to take your house. Really? I don’t think so. For the most part, the collection agency case is for a few thousand dollars. I’d say that the average case that my office handles is over an alleged debt of $6000. Does it remotely make sense that they could take your house for a debt of $6000? Of course not. That type of threat is generally illegal in PA. (As a side note, if the collection agency does win in court, they may be able to place a lien on your home. This is much different than taking it).
We’re going to press fraud charges or put you in jail if you don’t pay this debt! Another illegal threat. First of all, there is no court in the land that is going to put you in jail for failing to pay a credit card or collection agency debt. Second, they can’t press fraud charges against you. If there was the possibility of fraud, wouldn’t it make sense that the original creditor or financial institution that your alleged account was with would do that? They didn’t, and instead choose to sell your claim to the collection agency. Such a threat in PA is illegal.
Any other type of threat that sounds outlandish or “just not right” is likely illegal in PA. The illegal threats are pretty easy to see. On the flip side, there are some “threats” that are legal in PA. The threat to sue is one. The collection agency absolutely has the right to file a lawsuit against you if you fail to pay an alleged debt. Whether they can actually prove the case in court is another issue that has been answered in detail in many of my other articles.
The Fair Debt Collection Practices Act (FDCPA) is a federal law that protects consumers from unfair “threats” and practices by collection agencies. It is a fairly strong law that makes it illegal for the debt collector to engage in abusive practices. Making some of the above described threats is a violation of this law, and may give you the ability to sue the collection agency for its conduct.
In a nutshell, if you hear a threat that just doesn’t sound legal, it probably isn’t. Make a note of who made the threat, what agency they were with, what the date was, time of day and then contact a consumer attorney with that information. You may just have a lawsuit against the collection agency.
Greg Artim is a Consumer Attorney based in Pittsburgh, PA. He handles Collection Agency and Credit Card Defense matters in all of Pennsylvania. For more answers to your Pennsylvania Credit Card Law questions, please visit his website at PA Credit Card Laws .
Article Source: http://EzineArticles.com/?expert=Greg_Artim
http://EzineArticles.com/?Can-a-Collection-Agency-Threaten?&id=3051757
Collection Agency Law Explained
Posted by: | Comments
Collection Agency Law Explained
By Stu Pearson
If you have ever been contacted by a collection agency, you know that it can be an unpleasant experience. A collection agency can turn simple acts, such as checking the mail or answering the phone, into dreaded tasks. However, it is important to know that there is a law in place intended to protect the people that collection agencies contact. The FDCPA (Fair Debt Collection Practices Act) was enacted to keep debt collectors from abusing, harassing, or deceiving a person when attempting to collect a debt. It also gives debt collectors strict guidelines to follow when collecting a debt. In this article, we will have this collection agency law explained in simple terms, to better inform debtors of their rights.
For starters, the FDCPA outlines very clear practices for debt collectors to follow when contacting a debtor. Debt collectors are only allowed to call during reasonable hours (usually 8:00 a.m. – 9:00 p.m.), but they are also allowed to call a debtor at work. However, if the debtor notifies the collection agent that their employer wants the calls to cease, the debt collector must stop calling the person’s place of employment.
There are also rules of conduct a collection agency must follow when collecting a debt. A debt collector is forbidden from harassing any person from whom they are trying to collect a debt. Examples of harassment include excessively calling, insulting the debtor, or using obscene language. A debt collector is also not allowed to make false statements when collecting a debt. Examples of false statements include posing as a government official, making threats (lawsuits, imprisonment, seizing of home and property, etc.), or telling the debtor they owe more than they actually do. In addition, a debt collector can not use unfair practices in attempting to collect a debt. These practices include collecting an amount larger than what the debtor actually owes, or suing the debtor for a debt they do not owe.
The FDCPA requires collection agencies to notify debtors of their rights, and any correspondence (mail or phone) has to contain the information that the contact is being used to collect a debt. The only reason a collection agency can contact a third party (family or friend) is to acquire the debtor’s phone number or address. If the collection agency has this information, they are forbidden to contact a third party. It is also illegal for collection agencies to tell a third party that they are attempting to collect a debt.
The FDCPA is in place to protect the rights of debtor’s while making a collection agent’s job clear and concise. If a person being contacted by a debt collector feels that they are experiencing the violations discussed in this article, it is important that these misconducts are accurately documented. The reason for this is so that the claims can be proven if the debtor decides to take legal action.
Now that you have had this collection agency law explained, you should feel more confident about your rights if you are ever contacted by a debt collector. It is best to avoid the situation altogether by staying current on your debts, but it is good to know that the FDCPA exists if ever find yourself on the receiving end of a collection call.
Stu Pearson has an interest in Finance & Business and Collection Agency, for more FREE information and articles please visit Collection Agency Resources
Article Source: http://EzineArticles.com/?expert=Stu_Pearson
http://EzineArticles.com/?Collection-Agency-Law-Explained&id=223762
Predatory Collection Agencies – Another Reason Never to Take on Debt
Posted by: | Comments
Predatory Collection Agencies – Another Reason Never to Take on Debt
By Nick Adama
The number of potential violations of law, court procedures, and common human decency that the owners, managers, and employees of collection agencies have been caught engaging in is almost endless. Homeowners facing foreclosure, consumers considering bankruptcy, and even families attempting to pay back loans but who have fallen on hard times should be aware of these tactics in order to recognize them as the violations they are.
A previous article discussed some of these shady practices, including violations of the federal collection laws, seizing bank accounts holding exempt Social Security payments, obtaining judgments fraudulently by failing to serve borrowers with lawsuit paperwork, and others. In general, if a collection agency is involved in pursuing a debt, the main objective will be embarrassing borrowers, not making sure the debt is paid.
Even in the cases of identity theft, collection agencies will keep pursuing a debt once it has been established that the debt is exempt. Instead of giving up on such collection attempts, the account is usually just sold to another debt collector who begin the process all over again. If the borrower sends documentation that the debt is noncollectable due to identity theft, it is just sold to the next agency.
Debt collectors will also take advantage of the fact that most debtors do not know that they can request no more phone calls be made to their work, home, or other phone numbers. Instead, the agency will threaten to keep calling until the borrower is thoroughly embarrassed or has lost his or her job due to the harassment. Although this is against the law, collection agencies know that most borrowers are not aware of their rights.
Collection agencies know two things: they often can not validate a debt, and borrowers do not know how to defend themselves in court. Thus, when a collector is sent request for validation, it often responds by filing a lawsuit against borrowers. However, this is against the law, as a collection agency that can not validate a debt is no longer allowed to pursue any collection attempts until it has the information to validate properly.
The worst action that borrowers may take is agreeing to pay back a debt, in some instances. Collection agencies, once authorized to debit a bank account for periodic payment, will attempt to withdraw as much money as possible from the debtor’s account over a very short period of time. This can result in NSF fees, overdrawn account fees, and the closure of the bank account in the end.
In some states, debt collectors are able to dictate to the banks what to do with borrowers’ money even without a judgment, court order, or lawsuit. So-called “pocket service” laws state that a bank can be served with a garnishment summons and the bank account must be frozen for the payment of the debt. Again, exempt Social Security payments may be in the account, but borrowers must fight to get those funds back.
It should be noted repeatedly by homeowners and consumers that collection agencies file a large number of lawsuits, regardless of the statute of limitations, identity theft, or being able to find and serve the debtor properly. In almost all of these cases, the collectors use lawyers to file frivolous, fraudulent lawsuits and obtain default judgments, even for debts that are otherwise noncollectable.
Veterans are not protected, either, from the deceptions of collection agencies. A report by the National Consumer Law Center has this to say:
“My client, a soldier in Iraq, gives (Debt Collector) permission to debit his account for $300 on 5/1. They proceed to clean out his account. He called [his bank] and asked that [Debt Collector] be blocked from any further access to the account. (The Bank) tells him that is not enough; that [Debt Collector] is well known to them, and they will simply take further monies under a different name–they do this to soldiers all the time.”
Debt collectors usually are not picky about which groups they harass — everyone is an equal opportunity victim. But obviously, some companies decide to enter niche markets, like taking advantage of veterans based overseas who find it more difficult to defend against such actions.
Thus, every homeowner should be on guard against the fraudulent practices of debt collection companies attempting to embarrass debtors more than have debts repaid. Many of these parasites masquerade as law firms, using their political connections to sue borrowers even when all of the actions they must perform to get a judgment are based on lies and against the law.
Of course, this is not to say that every borrower is being preyed upon or every debt collector is a predator. However, a surprising number of collection agencies have established a pattern of behaving in a manner designed to humiliate borrowers instead of give them opportunities to repay defaulted debts. By gaining an awareness of such practices, hopefully more debtors will be able to avoid being taken advantage of by fraudulent companies and lawyers.
Nick writes for the ForeclosureFish website and blog, which provide foreclosure help and information to homeowners attempting to save their homes. The site describes numerous methods to avoid foreclosure, including deed in lieu, loan modification, stopping a sheriff sale, and many others. Visit the site today to read more about stopping foreclosure while there is still time: http://www.foreclosurefish.com
Article Source: http://EzineArticles.com/?expert=Nick_Adama
How Collection Agencies Violate Debt Collection Lawsc
Posted by: | Comments
How Collection Agencies Violate Debt Collection Laws
By Nick Adama
The Fair Debt Collection Practices Act (FDCPA) was originally designed to protect debtors against abusive actions taken by collection agencies when they are pursuing a debt. There are numerous violations that may cause penalties against the debt collector to be paid to the borrowers or applied to the balance of the account. Two of the most important are prohibitions regarding communications with third parties and harassment of debtors.
Throughout the history of the FDCPA, court cases have been defining what is and is not a violation of the Act. Collection agencies and collection lawyers are the types of business that receive the most complaints by consumers though the Federal Trade Commission. The two most common complaints the FTC receives regarding collectors involve claims of harassment and collection agencies pursuing more than is really due.
A number of recent decisions in court cases have helped flesh out some of the issues regarding harassment and collectors contacting third parties (such as a borrower’s brother or coworker). In many cases, debtors that just defend against such actions can uncover numerous violations of the law by collection agencies. The borrowers may owe the money, but if the collector can not prove it owns the debt or has broken the law, its claims to recover may suffer severely.
In terms of communications with third parties in the collection of an account, debt collectors are not allowed to leave messages with family members of the debtor and request that they be conveyed through the third party to the borrowers. Failing to leave required notices may also be considered a violation of the Fair Debt Collection Practices Act.
Debt collection companies and lawyers must also protect borrower information when sending letters in the mail. One court found that a collector violated the FDCPA when it sent a letter to debtors with a window envelope where anyone could see information about the debt being referred to, including the creditor and the account number.
As well, debt collectors are not allowed to discuss or sell borrower information to nonaffiliated third parties. Collection agencies may not be allowed to make even more money from taking the personal information of debtors and selling them to marketing partners, poor credit card partners, transfer credit card partners, and others. This would be a clear action of communicating with third parties while collecting a debt.
Harassment is also a huge complaint of borrowers against collection agencies, as mentioned above. Collectors may call at all hours of the day, at work, home, on cell phones, and to family members of the debtor. While they are required to cease such communications if informed by the borrowers, collection agencies have been known to keep pursuing debts in violation of such laws. Repeated rude, threatening phone calls have been found to be a violation of the FDCPA.
For example, one collection agency actually had its agents visit a borrower’s home to deliver lawsuit papers and shout outside in a loud voice. They repeatedly yelled the debtor’s name and shouted things like “you need to get your ass out here and open your gate now,” and “you need to come out and get these legal papers now.” One court has found this behavior to be a violation of the prohibition against harassment.
Debtors should also watch out for collection agencies attempting to get them to admit things both the borrowers and debt collector know to be untrue. Even though the collector’s own records showed that a payment had been made, it attempted, though the court discovery process, to get the borrowers to admit it had not been made. The court found this behavior to be abusive, unfair, and an unconscionable practice which violated the FDCPA.
Collection agencies use a lot of devious tactics to pursue debts that they do not even really own. They seem to rely on harassment, deception, and embarrassing borrowers to extract money to keep them quiet. But once they come across a borrower willing to pursue the issue and challenge the debt and the collection practices in court, debt collectors are often found to be in violation of federal lending laws. If the debts they are collecting are legitimate, why is it so difficult for these companies and lawyers to follow a few simple laws?
Nick publishes information for the My Personal Bankruptcy Lawyer website, which attempts to educate borrowers how filing for bankruptcy will affect their lives. The site examines the different types of bankruptcy, how to avoid filing, and the best resources borrowers can take advantage of if it becomes necessary. Visit the site today to learn more about financial setbacks, foreclosure, debt settlement, and more: http://www.mypersonalbankruptcylawyer.com/
Article Source: http://EzineArticles.com/?expert=Nick_Adama
http://EzineArticles.com/?How-Collection-Agencies-Violate-Debt-Collection-Laws&id=3169343
Collectors Harrassing ? When Enough is Enough
Posted by: | CommentsOne time or another in life we all go through hard times. Some of our hard times are financial and even though you had all intentions to paying back a loan or credit card sometimes things happen that our debt cannot be paid back on time.
Contrary to many people,collection agents and collectors say, being in debt and not being able to pay those debts is not always your fault. You might have at the time been fully employed paying off your debts as they came in and always been responsible or trying to be responsible. A real part of reality is that not everyone will be financially ok at all times no matter how hard we work or how hard we try.
Companies layoff workers, economies go into recessions, businesses close, times change what you were successful at yesterday might not have a market today. The truth is that the credit companies and banks that gave you credit and these loans knew this and were hoping for it. They gave you credit in hopes that you would pay late and pay their high interest rates. Those rates that you paid all that time probably already paid off your core debt. The rest being all profit.
When you no longer can pay these creditors and banks sell off your accounts to debt collectors and collection agency. This is one of the least controlled fields in the consumer credit and all of businesses. There is no special license needed, no background checks , nothing that will prevent illegal agents and agencies from breaking the law.
If we have been unfortunate in life then we know what it is like to get those phone calls, those letters. We feel bad , we feel scared , and we often are abused by collection agencies. Knowing that we already feel guilty about our debt is the reason why collection agencies think they can away with harassing you .
You do have very clear rights though. A federal law known as the Fair Debt Collection Practices Act limits what debt collectors can do to harass you about debts. This holds true for all debt collectors including attorneys.
What debt collectors are allowed to do is call you , call you at work , and contact you by mail. They have every right to try to collect a debt.
What debt collectors not allowed to do ?
A debt collector cannot contact you before 8 am or after 9 pm
Call you continuously or harass you
Use Profane language
Claim to be an attorney or government employee when it is not.
Send you documents that look like legal papers when they are not.
State that forms sent to you are not legal documents when they are.
Say that you committed a crime.
Call your work after you or your company say its not permissible
Call your neighbors, friends or family if they know where you live.
Claim to law enforcement
Make any claim or discuss law enforcement, arresting you, going to jail, being a police officer, taking you to criminal court , etc etc.
Tell anyone about you debts.
Threaten you in any way.
Yell at you
Call you names
Says it will garnish your wages or sell your property if it is not legal to do that.
Says it will sue you, if the collector doesn’t intend to sue.
Is not truthful about the amount of money you owe.
Says you will be arrested if you don’t pay the debt.
Threatens you with violence.
They cannot call you and not tell you who they are .
Cannot leave a message without identifying who they are and for what reason they are calling for; they must state their name and company and that they are calling you in regards of debt and all information collected will be used to collect the debt, and the message should not be heard by anyone else.
All those things are methods used by Collections agencies and all the above examples are illegal and you can be compensated at least 1000 thousand dollars plus lawyer and any damages caused by the collector.
If you have experienced any of the above situations I strongly suggest you contact a Consumer Attorney. You will win your case and it is best to start saving the messages and do not speak to any collector at all , have them all go to your voice mail and save them .