Most of the population is not economically viable nowadays because of the economy’s poor performance. It is such a struggle for a lot of American families to stay relevant and on top of their financial situation. A lot of people unwillingly go into bankruptcy because of hardships. The most common debts incurred are medical expenses, mortgages, utility bills, credit card bills, phone bills, car payments and a whole bunch of other stuff. Hard to cope with the payments right? It is not uncommon that folks these may sometimes default on their payments. And when you start defaulting on your debt payments … the harassment begins.
Ever experienced being called early in the morning or late at night from a stranger (sometimes with a strange accent) demanding that you pay your credit card or home mortgage or else $@#&!!!! Or you were at an office meeting and was unfortunate enough to have your phone on speaker and that call comes in and everyone in the room hears how much in debt you are and that you are a deadbeat blah! Blah! Blah! On top of that you keep on receiving mails stating that you will be sued and that your credit will be ruined; you’ll never be able to have a credit card or apply for a home loan again. Before you reach for that shotgun, jump from the top of the building, succumb to your creditors’ demands or get into a nasty verbal altercation with the person on the other line … take a deep breath, relax and read on – know your rights as a consumer! FDCPA – Fair Debt Collection Practices Act The Federal Trade Commission drafted this law to protect consumers from being harassed by their creditors. Before continuing, here are some helpful terms:
Creditor – Any entity (person or company) who extends or offers a loan and therefore a debt to this entity is created. This term does not apply to any person or company that receives this debt for the purpose of collection.
Debtor – The person who is obligated to pay the debt. Debt Collector – Any person or company whose purpose is to retrieve payment from the debtor but they are not the principal entity owed to.
What you need to know …
Based on the Fair Debt Collection Practices Act, if a debt collector needs to gather information to locate the debtor and is speaking with someone who is not the debtor, they are advised to:
1) Not identify themselves as a debt collector and state that they are trying to find information about the debtor. They could give the name of their employer only if explicitly requested by the answering party.
2) Must not give any information about the consumer/debtor nor the status of the debt owed.
3) Do not send any postcards that contain information that they are trying to collect from the consumer/debtor.
4) For collection letters, it must not indicate that it is coming from a collections company nor contain any message pertaining to the debt owed by the debtor (in case someone else might open it).
5) Can only communicate with the debtor’s lawyer after thorough verification that the person claiming to the be the debtor’s lawyer is the real deal.
If the debt collector is able to get hold of the debtor/consumer:
1) They are not allowed to threaten or harass the debtor/consumer.
2) They are not allowed to give misleading information or false representation to the debtor/consumer.
3) They are not allowed to use any form of unfair practice to collect the debt (example: seizing the title of your property , charge additional fees, etc.). Note: The FDCPA is applicable to consumer debts and not business debts.
- For cases like taking out the debt against your property, the collection company has to go to court first and petition for garnishment.
- When you’ve already filed for bankruptcy, debt collectors are not allowed to contact you because of the automatic stay, they have to wait for the bankruptcy proceedings to end. In Chapter 7 bankruptcy, property may end up being relinquished or foreclosed to pay off debts.
If a debtor/consumer has filed for bankruptcy, the debt collector has to cease all debt collection activities as stated in the US Code Title 11 Chapter 3 Subchapter IV §362 or Automatic stay. Excerpts from this Code include:
1) All attempts of collecting the debt must cease (phone calls, letters, law suits, etc.).
2) Debt collectors could no longer enforce judgments obtained before the bankruptcy case commenced.
3) Debt collectors are not allowed to seize property if the person has already filed for bankruptcy.
4) Debt collectors are not allowed to pursue or recover any claims against the debtor/consumer once the bankruptcy is filed. Remember the purpose of bankruptcy is to give people who are heavily indebted a fresh start.
In the event that you have already filed for bankruptcy and the debt collectors are still harassing you, you can:
1) Call your attorney.
2) Call the FTC (Federal Trade Commission) and ask if your debt collectors are pursuing you within the statute of their limitations because if the FTC discovers that the debt collectors pursuing you have violated the FDCPA, they will sanction the debt collectors.
Know your rights. The Thomas Hogan Law Office has been in the business for 25 years. We help people find solutions to their debt problems. Call or visit us now for a free half hour consultation.