Fair Debt Collections Act http://www.wisebread.com/taxonomy/term/11029/all en-US Deal With Your Debt or You May Go to Jail http://www.wisebread.com/deal-with-your-debt-or-you-may-go-to-jail <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/deal-with-your-debt-or-you-may-go-to-jail" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/383476178_8fe0f5e767.jpg" alt="gavel" title="gavel" class="imagecache imagecache-250w" width="250" height="188" /></a> </div> </div> </div> <p>Collection agencies are using severe methods to go after debtors. They're going through the courts to collect. The choices are show up, pay up &mdash; or get locked up.</p> <p>First, the collection agency files a lawsuit against the debtor. (The agency should send the debtor an official notification in the mail.) If the debtor doesn't appear at the hearing, the judge can vote in favor of the collection agency (called a default judgment) then schedule another hearing to review the debtor's assets. If the debtor doesn't appear at this hearing, the judge can declare that the debtor is in contempt of court and issue a warrant for his/her arrest. Not only will the debtor have pay what is owed, but also court fines and, in some cases, bail money.</p> <p>Federal law abolished debtor's prison in 1833. However, this scenario has been appearing with increasing regularity in Minnesota, Wisconsin, New Jersey, Arkansas, Indiana, Illinois and Washington. According to the Minneapolis-St. Paul Star Tribune, in 2009, there were 845 cases of debtors being sent to prison in Minnesota.</p> <p>How can you protect yourself and stay out of jail? Follow these five steps:</p> <h3>1. Open your mail</h3> <p>When your account is months past due, your original creditor will usually sell your account to a third-party collection agency for pennies on the dollar (that way they get something for your loan balance). Then, of course, the collection agency wants to make a profit, so they start calling and sending threatening letters to scare the money out of you. If you contact the agency in writing that you want them to stop calling, by law, they should stop.</p> <p>However, if you don't respond they might decide to take you to court. In that case they <i>should </i>send you an official notice of a court hearing with a date so that you can attend and defend yourself. The notice should also have the official court address on the envelope, but sometimes (wrongly) the agency will send an &quot;unofficial&quot; letter giving you notice. Don't put your mail in a big pile or in a brown bag and assume it will go away. Open and read everything; if there is a collection notice, you will know.</p> <h3>2. Know what you owe</h3> <p>Keep track of your outstanding loans. Look at your statements and keep a file. If you are having trouble making timely payments, contact the creditor and let them know. Some creditors will offer a reduced payment/lower interest program. In the case of medical debt, most doctors and hospitals don't charge interest and will usually agree to a payment plan.</p> <h3>3. Review your credit report regularly and dispute errors</h3> <p>Checking your credit report every four to six months will show you where you stand with your debt and debt payments. (Go to <a href="http://www.annualcreditreport.com/">AnnualCreditReport.com</a>.)You can see if an account is so delinquent that it has been sold to a collection agency. It will appear above the Account History section under Collections.</p> <p>For example, it isn't unusual for a person who has been in the hospital to find medical debt in collection that he or she wasn't even aware of. (Hospitals can send dozens of bills so it is easy to miss paying a few.) Also, landlords, utilities and phone companies can come up with final charges, but you might not get the bill if you've moved. Five months later, the charge will show up as a collection item. Review each item in your report, and if something is incorrect, write to the credit bureau to dispute it. (Go to <a href="http://www.ftc.gov/">FTC.gov</a> for dispute forms.)</p> <h3>4. Show up in court if you get a notice</h3> <p>You need to appear in front of the judge to plead your case. If you don't show, then the judge will only hear the collection agency's version of the situation. When there are extenuating circumstances, you can ask the judge for special consideration and work out a compromise payment plan. Also, if you're experiencing financial hardship, bring a financial statement detailing your assets and liabilities and a cash-flow statement with your income and essential expenses.</p> <h3>5. Demand to see proof of the original debt</h3> <p>When you're in court pleading your case, ask the collection agency to show proof of your original debt. In some cases, your account has changed hands several times and the collection agency has no written legal evidence of the original loan. That may win your case right there.</p> <p>Many people are struggling with debt, and collection agencies are getting more aggressive in coming after delinquent accounts. Even if your accounts are in collection, you do have rights. (Go to <a href="http://www.ftc.gov/">FTC.gov</a> for more information on the Fair Debt Collection Practices Act or read a previous <a href="http://www.wisebread.com/laws-the-leg-breakers-don-t-want-you-to-know-about">Wise Bread article on the FDCPA</a>.) Be aware of the potential consequences of ignoring your debts, and be pro-active if you're summoned to court. Otherwise, you might be taking an expensive ride in a paddy wagon to the Big House.</p> <div class="field field-type-text field-field-guestpost-blurb"> <div class="field-label">Guest Post Blurb:&nbsp;</div> <div class="field-items"> <div class="field-item odd"> <p>This is a guest post by Hollis Colquhoun. Hollis has over 20 years of experience in the financial industry, is an Accredited Financial Counselor and co-author of <strong>Women Empowering Themselves: A Financial Survival Guide</strong>. Contact her at <a href="http://www.womenempoweringthemselves.com/">Women Empowering Themselves</a>. Here are more articles by Hollis:</p> <ul> <li><a href="http://technorati.com/blogging/article/avoid-expensive-credit-report-services-when1/">Avoid Expensive Credit Report Services When You DIY For Free</a></li> <li><a href="http://technorati.com/business/article/the-college-challenge-which-way-to/">The College Challenge: Which Way To Pay</a></li> </ul> </div> </div> </div> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/hollis-colquhoun">Hollis Colquhoun</a> of <a href="http://www.wisebread.com/deal-with-your-debt-or-you-may-go-to-jail">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-1"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/look-out-consumers-debt-collections-get-scarier">Look Out Consumers: Debt Collections Get Scarier</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/always-answer-the-call-expert-advice-on-debt-collection">Always Answer the Call: Expert Advice on Debt Collection</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-to-rebuild-your-credit-in-8-simple-steps">How to Rebuild Your Credit in 8 Simple Steps</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/the-best-0-balance-transfer-credit-cards">The 5 Best 0% Balance Transfer Credit Cards</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/8-tips-for-improving-or-starting-a-budget">8 Tips for Improving or Starting a Budget</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Debt Management court debt collections Fair Debt Collections Act Thu, 05 Aug 2010 14:00:07 +0000 Hollis Colquhoun 196262 at http://www.wisebread.com Look Out Consumers: Debt Collections Get Scarier http://www.wisebread.com/look-out-consumers-debt-collections-get-scarier <div class="field field-type-filefield field-field-blog-image"> <div class="field-items"> <div class="field-item odd"> <a href="/look-out-consumers-debt-collections-get-scarier" class="imagecache imagecache-250w imagecache-linked imagecache-250w_linked"><img src="http://wisebread.killeracesmedia.netdna-cdn.com/files/fruganomics/imagecache/250w/blog-images/money_bags_0.jpg" alt="money bags" title="money bags" class="imagecache imagecache-250w" width="250" height="178" /></a> </div> </div> </div> <p style="margin-bottom: 0in;">As if we don't have enough on our collective plates worrying about our legitimate debts, it is now coming to light that more scam artists are trying to collect on debts you may not even have. Just this week in the state of New York, an ex-con and his cronies were busted and a nationwide debt collection company was shut down. Based in Buffalo, NY, the &ldquo;debt collection agency&rdquo; operated using several different company names, including Central Resource Man, Interchange Payment Solutions, Next Step Services, Silverbay Services, Teleport, Final Claims Asset Locators and Final Control Asset Locators.</p> <p style="margin-bottom: 0in;">The apparent ring leader was Tobias Boyland, a convicted felon who, along with three other individuals ran debt collection practices in at least four different locations in Western New York. The complaints that were filed against them with the District Attorney's office alleged that Boyland and his team would contact individuals about debt collections, often using threats of being arrested to frighten people into paying back debts. The team also intimidated consumers by lying to them about the status of their debts that have have gone to court. Some involved in the ring even posed as law enforcement officers to add to the intimidation. In many cases, the amount of the debt was inflated or had already passed the statue of limitation, Consumers were scared, believing they were being sued or face legitimate incarceration, they started paying up. While this ploy is scary on its own, many of the collection calls the companies were making were about <em><strong>debts that didn't even exist!</strong></em></p> <p style="margin-bottom: 0in;">Due to the scare tactics, many consumer volunteered their checking account information, sent money via Western Union, or mailed out money orders. All of the monies were directed to be sent outside of the Buffalo area, to further mislead authorities and consumers alike. The Fair Debt Collection Practices Act prohibits any debt collection company to pose as an attorney or a member of law enforcement, threaten a lawsuit, accuse debt holders of a crime, or threaten arrest. The fraudsters violated many aspects of this federal law and were arrested. At the time of arrest, Boyland was in possession of a loaded semi-automatic pistol. New York Attorney General Andrew Cuomo and his office has been pursuing deceptive debt collection practitioners and has successfully shut down several operations and will continue to do so.</p> <p style="margin-bottom: 0in;">We as consumers now have an additional concern to worry about concerning debt. While many people are getting much better about handling their debts and avoiding it altogether, there are still many families struggling to get back on track. Knowing the debts they do owe can lead them to be victims of fraudulent practices, makes the burden and humiliation of debt even bigger. When you are dealing with debt collectors and making an honest attempt to clean up your credit, make sure you know your rights. Review the <a href="http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre27.pdf">Fair Debt Collection Practices Act</a>.</p> <p>Get smart about your <a href="http://www.wisebread.com/5-personal-finance-tips-you-dont-always-hear-about">personal finances </a>and your debts. Make notes on the dates and times you are contacted by <a href="http://www.wisebread.com/dealing-with-nasty-debt-collectors">a collection agency</a>. Be certain you actually owe the debt before you take any action. If you feel that something is amiss with the way your debt is being handled, speak up! Contact your local authorities. While it can be very scary to deal with thug-like callers demanding money, don't make additional financial mistakes by sending money to just anyone. Know your rights and take a stand when it comes to people messing with your money, your credit score, and your sanity.</p> <br /><div id="custom_wisebread_footer"><div id="rss_tagline">This article is from <a href="http://www.wisebread.com/tisha-tolar">Tisha Tolar</a> of <a href="http://www.wisebread.com/look-out-consumers-debt-collections-get-scarier">Wise Bread</a>, an award-winning personal finance and <a href="http://www.wisebread.com/credit-cards">credit card comparison</a> website. Read more great articles from Wise Bread:</div><div class="view view-similarterms view-id-similarterms view-display-id-block_2 view-dom-id-2"> <div class="view-content"> <div class="item-list"> <ul> <li class="views-row views-row-1 views-row-odd views-row-first"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/deal-with-your-debt-or-you-may-go-to-jail">Deal With Your Debt or You May Go to Jail</a></span> </div> </li> <li class="views-row views-row-2 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/acknowledge-you-have-a-problem-with-debt">Acknowledge You Have a Problem with Debt</a></span> </div> </li> <li class="views-row views-row-3 views-row-odd"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/how-does-the-fannie-mae-and-freddie-mac-bailout-affect-you">How does the Fannie Mae and Freddie Mac bailout affect you?</a></span> </div> </li> <li class="views-row views-row-4 views-row-even"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/uk-banks-are-blocking-customers-credit-cards-will-the-usa-be-next">UK banks are blocking customers&#039; credit cards. Will the USA be next?</a></span> </div> </li> <li class="views-row views-row-5 views-row-odd views-row-last"> <div class="views-field-title"> <span class="field-content"><a href="http://www.wisebread.com/get-out-of-debt-first-then-focus-on-saving">Get Out of Debt First, Then Focus on Saving</a></span> </div> </li> </ul> </div> </div> </div> </div><br/></br> Personal Finance Debt Management consumer issues debt collections Fair Debt Collections Act fraud Wed, 24 Jun 2009 17:07:44 +0000 Tisha Tolar 3311 at http://www.wisebread.com