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Debt Litigation Myths

Mon, 09 Apr 2012 15:24:50 +0100

Unfortunately, many of us may face litigation over unpaid debts. It has become a reality for more Americans over the last five years than ever before. Job loss, divorce, or any number of other reasons can be the root cause. Whatever the reason you find yourself in this situation, here are a few litigation myths that you should be aware of.

I have to appear in court on the answer date. No, the answer date is the last day to present a written answer to the collectors suit. This is not a hearing date. If you fail to answer, the collector will win the suit, so do not ignore this date altogether.
I need to tell the judge why I did not pay the debt. This is the worst thing that you could do. An explanation is as much as an admission of owing the debt and you will most likely have a judgment awarded against you.
The judge will help me in court. No, the judge is not there to help you stumble through the process. If you fail to prove your case, you will lose. If the debt is fairly large, you may want to hire an attorney.

The knee jerk reaction to a lawsuit of debt is to ignore it. That makes it easier for the debt collector because they will win a default judgment for the full amount plus any reasonable costs associated with the lawsuit. If the debt is small enough, pay before it goes to court. If it is large, retain an attorney. Whatever you do, do not ignore the lawsuit. It will not go away.

This guest post provided by DebtReliefAlabama.org, a leader in helping people in need of Alabama debt settlement and Alabama debt consolidation services.

Five Things That Debt Collectors Are Never Allowed To Do

Mon, 02 Apr 2012 18:22:06 +0100

Falling behind on bills has become a part of many people's lives. Often, that leads to having to deal with a monster more hideous than any imagined or put on a movie screen...the debt collector. These are many headed creatures that strike fear with the mere mention of their name. Despite their pitiful reputations, debt collectors are regulated by the Federal Trade Commission (FTC) and there are certain things that a debt collector may never say or do. Here are five of them.

In the past, many debt collectors would create their own court papers in order to scare people into paying. A debt collector may never send you a document that looks or is purported to be a court document unless it is real.
A debt collector may never threaten to have you arrested for not paying a debt.
A debt collector must identify itself as such and can not use a false company name while dealing with you.
A debt collector can not threaten to take any action that they know to be unlawful or that they do not intend to actually take.
A debt collector can not claim to be an attorney, police agent, government agent, or claim that you have committed a crime.

There are a huge number of things that debt collector may not do. That does not mean that an unscrupulous agency will not try to get away with some of them. This information has been brought to you by Texas Debt Consolidation. If you are being preyed upon by a debt collector, go to www.ftc.gov to discover your rights or file a complaint.

Checklist To Follow When Switching Banks

Thu, 22 Mar 2012 14:59:11 +0100

As some banks continue to add new fees and increase others, many of us are looking to switch to a more customer friendly institution. That sounds pretty simple, but in the age of direct deposit and auto drafts it can become a nightmare if you forget even one item. The last thing you want to do is rack up those crushing fees, and have the debt collectors after you because you can't pay your auto or mortgage. Here is a short checklist to help you avoid any inconveniences that could affect daily services or your credit score.

Start at work. Let HR know that you have a new bank so they can stop your old direct deposit and begin the new one.

Contact the merchants, insurance companies, and financial institutions, and anyone else that you have given authorization to auto draft your accounts. Forget even one and you will be facing nasty overdraft fees and the possibility of having something shutoff or repossessed.

If you use online banking, download and print all bank statements from your old institution. While on the site, copy down all biller and payee info that you can find.

Does your old institution offer discounts on car loans in Florida or mortgages that you hold with them for auto drafting from a checking account at their institution? If so, refi those loans or keep your account open with just enough cash to pay those bills.

Switching banks sounds easy enough and it is if you just have simple checking and savings accounts. Things get more complicated the more items you connect directly to the account. Your best tool to switching is a list...a list of what comes into and out of your account.

This guest post was provided by our friends at Debt Consolidation Florida, who have been proactive not just helping people get out of debt, but helping them avoid it altogether as well.

Attorney Fee Awards from FDCPA Cases

Fri, 16 Apr 2010 17:10:43 +0100

Damage classification and FDCPA violations

When it comes to FDCPA violations and damages, the FDCPA classifies damages into the following categories:

Monetary damages. This includes payments made on time-barred debt, attorney fees and long distance phone fees.
Actual damages. When a consumer experiences psychological damages incurred by the consumer including psychological damages such as stress, emotional and mental problems. A person may also experience emotional damages such as emotional paralysis, nightmares, insomnia, anxiety, hysteria, nervousness, etc.
Statutory damages. When a consumer is able to prove that a bill collector, collection attorney or collection agency is violating the FDCPA rules, a consumer can be awarded up to $1,000 in an FDCPA claim.

Determining Attorney’s Fees

There are normally three types of ways that attorney’s decide to charge their clients for their services. The fees all depend on the kind of case they represent in court. This includes the following:

Hourly fees

Many FDCPA attorneys charge clients on an hourly basis. In addition to an hourly fee, an attorney can also charge a retainer fee.

Fixed fee basis

This is when an attorney charges a fixed fee on the following services: drafting a contract, real estate deeds, minor criminal matters, bankruptcy cases, traffic offenses, real estate titles, etc.

Contingency basis

This is when an attorney will charge a percentage of the total amount of an award. Attorneys usually charge on a contingency basis for workman’s compensation, Social Security issues, personal injury and civil rights cases.

Illegal Threats of Litigation

Thu, 15 Apr 2010 15:50:07 +0100

Often times, a debt collector or collection agency will threaten a consumer with litigation. If you have been threatened with litigation or abused and harassed by a debt collector, you have the right to file a FDCPA claim. Under Section [15 USC 1692e] § 807(5) of the FDCPA, a debt collector is breaking the law by threatening a consumer with legal actions. In addition, they are not allowed to do the following against you:

•    Reduce your credit scores
•    Wage garnishment
•    Causing you to get fired
•    Seizing your property
•    Suing you or threatening to have you arrested

If you have been threatened by a debt collector or debt collection agency with any of the above threats due to unpaid bills, easy payday loans that didn't turn out so easy to pay down, or delinquent car loan payments, it is recommended that you contact a qualified FDCPA attorney to help you file a FDCPA claim. These threats include harassing letters, phone calls and emails. For further information, contact this site and one of their attorneys will give you a call to discuss your case.

Proof: Saving Correspondence with Debt Collectors

Thu, 15 Apr 2010 15:40:10 +0100

Why it is important to save all correspondence?

Even 30 years after the Consumer Debt Protection Act was enforced, there are still a few collection agencies out there that slip through the cracks when it comes to obeying the law. It is highly recommended that you save all correspondence, letters, emails, voicemails or phone calls that have the potential to go to litigation. This can be utilized as proof in the court of law.

Recording Phone Calls Under the FDCPA

Today there are 12 states that permit consumers to record calls if you have the consent of the debt collection representative. The remaining U.S. states currently do not have this as mandatory; however, you will need to consent to the debt collection representative what you say during a phone conversation.

We have provided you with more information below about recording phone conversations with debt collection agencies. Please follow this link: is recording telephone calls or messages legal?

Saving Written Correspondence

When it comes to written correspondence, it is a little different. There are a few things that are considered forbidden by the FDCPA such as the following:

Using profanity
Lying about the amount of the debt owed
Threatening violent actions in order to collect debt
Fees that have been added on by the bill collector
Attempting to contact you after you have mailed a “cease and desist” letter
Mailing out collection notices to your employer when the employer disapproves
Contacting 3rd parties in writing about your debt and attempting to collect additional personal information

Hiring the services of an experienced FDCPA attorney can make a significant difference between winning a FDCPA claim or be harassed on a regular basis. For further details about your FDCPA claim, feel free to contact FDCPAClaims.com.

FDCPA Cases: Actual Damages

Fri, 16 Apr 2010 17:08:24 +0100

FDCPA Judgments against a Collection Agency

Consumers can file FDCPA claims against a debt collector and be awarded for damages caused by improper practices. In addition, a consumer can also file a private lawsuit at the federal or state level. As a consumer, you don’t have to prove “actual damages” to be awarded money.

The most that you can win in a FDCPA case is $1,000. Keep in mind that you will be given 1 year to file a FDCPA claim in court. The collection agency may be held liable for $500,000 or 1% of what your original debt was -- whichever amount is smaller of the two. A debt collector may also be liable for actual damages resulting from the decision of the court.

Actual Damages

Actual damages are psychological or physiological damages caused by harassment or abuse from a debt collector. Here are the categories of actual damages to remember:

Damages from deliberate imposed emotional distress to force payment from the consumer or their immediate family members.
Monetary damage such as charges for long distance calls from calling a debt collector in order for them to call a consumer back.
Attorney’s fees from a prior lawsuit from FDCPA violations
Incurred payments from a time-barred debt
Threatening to seize a consumer’s personal property in an illegal manner
Threatening to file criminal charges against a consumer

Stress-related

Common stress-related injuries include the following:
Diabetic flare-ups
Embarrassment and/or humiliation
Headaches/migraines
Hysteria
Unable to concentrate at work
Pain, and suffering
Nightmares, Insomnia, night sweats and much more

Questions? Think you might have a claim? Request a Free Claim Review.

Your Rights Under The FDCPA Law

Thu, 15 Apr 2010 01:25:49 +0100

Under the Fair Debt Collection Practices Act (FDCPA) of 1978, consumers have protection. This gives consumers the right to sue debt collectors who are abusive. You can sue a debt collector if they do the following:

Call during strange hours
Harass or threaten you
Threaten to sue you
Threaten to embarrass you by calling family or friends
Continue to make collection efforts after you told them to discontinue
Make misleading statements in written collection notices
Report false information about you to the credit bureaus
Threaten to send you to jail or threaten to set criminal charges against you if you fail to pay
Contacting relatives, children, parents, employers, friends and reveal your debt information
Make untrue statements regarding the debts they are collecting

According to the FDCPA, consumers have more rights with a collection agency who is normally hired to collect debt by the actual credit card issuer. The maximum that you can recover against a creditor for any of the FDCA violations, actual damages and reasonable attorney's fees is $1,000. Damages include financial loss as a result of psychological or medical trauma, as well as a wrongly reduced credit score. Credit score has a major impact on getting approved for all kinds of loans, and everybody knows that financing a car from buy here pay here lots catering to bad credit buyers can cost much more than auto loans with good credit.

Many bill collectors work in cubicles with a computer and telephone. They are basically paid to get as much money out of a debtor as possible. Bill collectors are given scripts and many are pushed onto the phones without training in order to fill the needs of the business. Some bill collection agencies pay their employees an incentive if they collect a certain amount of money from debtors. Often times, bill collectors will do anything to force a debtor to "pay up", even if it means violating the FDCPA.

Should You Hire an FDCPA Attorney?

If you feel that a collection agency has violated the FDCPA guidelines, an experienced FDCPA attorney can help you fight for your rights. You may be eligible to receive money for damages such as medical or psychological traumas -- including financial loss due to an unfairly reduced credit score.