Debt collectors have been known to use various techniques to secure payment, some of which violated the Fair Debt Collection practices act (FDPCA). This can include pestering debtors, their friends, relatives and co-workers with calls at inappropriate times and places. In other cases, debt collections for debts of the dead, can rise from the grave too, but in ways that they shouldn’t. Debt collectors have been known to call loved ones and others to pay off the debts of their dearly departed. Is this outrageous? We think so.
Aside from being callous, post-mortem debt collector calls are deceptive as relatives of the deceased are typically not responsible for the debts, unless the debt was joint among the deceased and the living. Playing on the lack of knowledge of the average consumer, and perhaps believing that the memory of the deceased would be tarnished in some way, debt collection agencies will call relatives and try sympathy tactics to convince the living that they should or must pay off a debt. The debt collector may not actually inform the bereaved that they have to pay the debt, but they will read from a script that is convincing enough to give that impression and to omit the fact that the living are not required to pay it.
Debt collection agencies justify such tactics with a cold heart and insensitive mentality, taking advantage of loved ones still saddened by the passing. Consumers beware: in the vast majority of cases, you need not pay the debt of someone who has passed. Check with a good consumer lawyer and find out how to protect yourself and to stop this practice.
A NJ man recently received phone calls from someone claiming to be a debt collector. As it turns out, he paid his loan back months ago but the phony collection calls still tried to scam him out of hundreds of dollars. He’s telling his story to warn others of the threatening calls and collection harassment he is experiencing over a debt he does not owe. Experts say be careful leaving your personal information on any website, and contact the proper authorities if you are the victim of such calls – including an attorney who will fight for your rights.
Debt Collectors can be nasty and have earned their reputation for not being easy to deal with. It is easier it seems to avoid them altogether, hoping that the problem will go away on its own. Unfortunately, collection agencies have a hard time giving up. They know they are supposed to work within the rules set forth in the FDCPA and yet they often continue to violate them one way or another. They know that a debt collector can do more to make life difficult and aggravating for consumers when it comes to student loans, than other collections, and can take a judgment against you without even filing a complaint. Federal loans also carry with them the opportunity for debt collectors to have employment wages garnished or have a tax refund paid to the lender directly.
If you have a Federally sponsored student loan and cannot pay, and wish to avoid debt collectors, either write a letter demanding the collector to cease contact; or, ask in writing for a deferment on your loan; or better yet, negotiate the balance, perhaps through an attorney (not a “debt settlement company”). Because student loans are different types of debt than typical consumer purchases, debt collectors are often instructed by the lender to agree to deferments or in some cases a reduction of the entire amount, payable over time. Whether it is because of a difficult economy, finding and keeping a job, a disability, care for a family member, personal illness or military service, these options can be very helpful and make things easier for you to handle.
Any type of debt harassment is a pain. But what about debts that have literally risen from the dead? Zombie debt is a debt that is old and often forgotten, or is a settled debt being brought back by a creditor or a collection agency claiming that it has no record of payment. Old debt is often sold by the original creditor to a different company (called a “debt buyer” who is also a debt collector) at a substantial discount, usually pennies on the dollar, where it can then be collected at obscene profit. It is this financial incentive that makes collectors greedy and abusive. Many consumers fall victim to this type of debt harassment.
Zombie debts are difficult to get rid of because it is so much more profitable to resell than to keep good records of paid accounts. In many cases, a debt will be sold without any information to the buyer other than how much the debt was for and the identity of the concerned parties. The debt buyer/debt collector may not know that a customer has already dealt with previous agencies and/or resolved the matter. This is all too common. There are several things that a consumer can do to stop zombie debt harassment, however. First, find out when the statute of limitations expires on the debt. If the debt is too old, the consumer may have an absolute defense to the claim, preventing the debt collector from winning in a court battle. However, just because the debt is old, does not mean the debt collector will stop trying to collect, so be aware that the defense must be raised in response to a court action, and that the debt does not disappear on its own just because it is old. If the debt collector is misrepresenting the age of the debt in some way or deceives the consumer in speaking of it, the collector has violated the FDCPA and is liable to the consumer. Also, ask for proof of the debt in writing, as well as ask the company to cease contact if they are being abusive. Don’t let zombie debt harassment ruin your life.
Graduation season is upon us. On campuses around the country the sights of robes and graduation caps, the sounds of “Pomp and Circumstance,” and the photos of loved ones celebrating the day fill the senses of graduates, friends, and families as one chapter comes to an end and they embark on a new one. Unfortunately, as the excitement calms, many recent graduates are confronted with the harsh reality of overwhelming amounts of debt. Most will then truly enter the world of responsibility by having to come up with ways of paying down their debt and fielding the phone calls from debt collectors. So, how can they pay down debt and stop collection calls?
Inevitably, that credit card is the main source of problems. Students spend more than they can afford and as they transition to their adult lives, and the interest payments alone can be overwhelming. It doesn’t take long after graduation for the bills to start coming in. Just as they congratulate their kids on a job well done, parents undoubtedly ask their children in shock, “You owe how much?”
A blog post on Forbes.com says that credit card companies want college students to be in debt because, frankly, that’s how they make money, pointing out that “students are easy targets” because they live in the moment, and are “deluded into thinking the credit card won’t present a problem when it comes time to pay.” Just when it couldn’t get any worse, the collection calls begin.
Even grads who have secured a job in this difficult economy may find it all too easy to fall behind on their bills. Defaults and past-due balances go from being something on paper to something they are confronted with in their lives. The same students that were “easy targets” for credit card companies now are “easy targets” for collectors and their tactics. They must come up with a plan to address their immediate financial well being and their long term needs, and they must learn what rights they have to stop the collection calls once and for all. Here are some tips for the indebted and the frustrated grad:
1. Take any job. You may not find your dream job right way, but you will be making money and creating networking opportunities.
2. Learn to save. Throwing away money at the club like you did in college has to become a thing of the past.
3. Deal with student loans NOW if at all possible. Pay what you can. If you don’t have a job, contact the lender and work out a plan.
4. Stop collection calls. This is easy. Consumer lawyers can stop the collection calls quickly and without charge. Learn your rights under the FDCPA and hire an attorney if you are experiencing debt harassment.
5. Pay off credit card debt and stop using that card! Spend only what you can pay in a 30 days cycle and don’t overdo it. Come up with a payment plan to get out of the red and into the black.
Beginning on July 21, the debt collection industry will be monitored closely by two regulatory agencies– the Fair Trade Commission (FTC) and the newly formed Consumer Financial Protection Bureau (CFPB). The FTC has been around for many years but the CFPB was created to reform the financial industry and better protect consumers, resolve widespread consumer complaints, and tighten debt collection laws. Here are a few ways consumers can hope for positive changes affecting the collection industry, including putting a stop to debt harassment.
Enforce the Fair Debt Collection Practices Act (FDCPA)
The Consumer Financial Protection Bureau will be able to enforce federal consumer financial laws, including the FDCPA. The purpose of the Act is to eliminate abusive debt collection practices such as contacting consumers outside of specified hours and using profane language in communication related to the debt. The CFPB will have the power to penalize companies that fail to comply with the FDCPA and can enforce violations of the Fair Credit Reporting Act and the Truth in Lending Act.
Review Debt Collectors’ Practices
Many Americans, as well as those in federal government, believe that financial institutions, the debt collection industry, and credit reporting companies are in need of reform to better protect consumers. The CFPB will review debt collector practices for example, and determine if their methods are abusive or unfair, but will still leave to private law firms the ability to pursue claims on behalf of individual consumers for monetary damages and private enforcement. If the Bureau deems necessary, businesses could be forced to tighten collection practices and reduce debt harassment at the hands of overly aggressive debt collectors.
The Federal Trade Commission (FTC) alleges that debt collection agency, West Asset Management, violated the Fair Debt Collections Practices Act (FDCPA) on multiple occasions, leading to thousands of consumer complaints.
Century Negotiations President Amy Michalo-Rojas urged clients, and the general public, to stay informed about these types of cases so they can recognize when a debt collector violates their legal rights.
West Asset Management allegedly violated the FDCPA—the law designed to protect consumers against deceptive and harassing debt collection tactics—by calling consumers multiple times a day, using rude and abusive language, taking funds without consumer permission, falsely claiming consumers would be jailed or sued, and even contacting consumers regarding debts that did not belong to them.
“Many factors can inspire a debt collector to break the law, from an unethical work environment to the challenge of collecting in a recessed economy,” explained Michalo-Rojas. “But individual consumer awareness and reported complaints can stop these violators and warn potential lawbreakers against similar behavior.”
Read the entire story here: Unscrupulous Debt Collection Agency Pays Record Settlement, Offers Lesson in Consumer Awareness, Says Century Negotiations
Computers are used to keep track of everything from personnel records, to bank accounts, to loans and revolving credit. When computer glitches occur, they can create havoc in your life. Just ask Daniel DeVirgilio, an Ohio man who recently received a cable bill for $16.4 million. An engineer at Wright-Patterson Air Force Base, he did the math and came to the conclusion that he would have to order 1.6 million on-demand movies or one pay-per-view fight 4,000 times in order to accumulate charges that high. Time Warner issued a statement saying they will work together with DeVirgilio to resolve the issue, but not every victim of such computer bugs is so lucky.
Take Patrice Perry, a client of our firm, for example, who received an even crazier bill from Capital One bank for $286,651,237 in 2009. After receiving repeated phone calls at work and at home by Capital One collectors, she retained counsel. Then she was sued and when she went to Court to defend herself, Capital One didn’t show up. Months of torment ensued, including phone calls to family members and co-workers and a refusal to cease harassing her. After being sued for debt harassment by our firm, Capital One released a statement blaming “human error” for the billing letter but they never commented about their harassing acts. Blaming a computer for sending a letter that also happened to increase the level of harassment was not the only thing happening here. For months, this consumer endured a living hell every time she picked up her phone or opened her mailbox, wondering what Capital One would try next.
Whether it’s a computer glitch or someone intentionally causing the computer to print a letter that was knowingly outrageous, companies will hide behind these excuses to justify the unfair practices they use with their customers. Have you received such a letter? What can you do if you receive a bill of much more than you could ever owe? Debt collectors must comply with the FDCPA even if the debt or the amount claimed is accurate or not. The Act was put in place to protect consumers by enforcing fair debt collection practices. If you or a loved one is experiencing harassment at the hands of a debt collector, contact an experienced attorney who will stop collection calls, end the harassment, and correct your bills once and for all.
Foreclosures and falling home prices continue to plague Americans all over the country. According to a report by 60 Minutes, banks that want to foreclose on homes can’t find the original ownership documents. Where did they go? It turns out that corners were cut by lenders and their investors on Wall Street by not maintaining the documents at all, saving costs, back when home sales were strong and banks never worried about foreclosure. Now, some companies are routinely using forged paperwork to cover up these practices so they can move forward with the foreclosure process – a clear violation of consumers’ rights and resulting in people being removed from their homes under deceptive circumstances.
What does this mean for the millions of Americans who have fallen behind on their mortgage payments?
The Fair Debt Collection Practices Act was passed in the 1970’s to protect consumers against unfair and abusive tactics by collection agencies. Debt collectors for mortgage loans are subject to the guidelines of the Act so homeowners who are dealing with foreclosure at this time could have a valid claim to keep their homes if fraudulent practices like those described above have occurred.
NewOrleansCityBusiness.com reported that a Louisiana couple who defaulted on their mortgage following Hurricane Katrina was awarded $10,000 for the years of debt harassment they endured, including continued and persistent telephone collection calls. During foreclosure proceedings, CitiMortgage Inc. admitted to “lost” paperwork. Ultimately, a state judge ruled in favor of the couple, after finding that the FDCPA was violated.
It is important for consumers to know their rights in order to protect themselves from unfair debt collection. Anyone who is facing the possibility of foreclosure should learn the FDCPA and how collection laws defend their rights as a consumer. Debt harassment is against the law, and we have experienced attorneys that enforce the Act on behalf of consumers.
In most cases, people who receive collection calls accrued the debt themselves and have fallen behind on their payments. In some instances, however, these charges are a result of identity theft. Because people rely on technology to pay bills and make banking transactions, it is important to stay protected against hackers and Internet fraud. The best way to avoid collection agency harassment is to reduce the risk of having your identity stolen in the first place.
Consumers who use debit cards should check their account activity frequently. Every major bank has an online banking option which makes it quick, convenient, and free to monitor checking accounts. Anyone who comes across questionable or suspicious transactions on their statement should contact the bank as soon as possible.
Credit cards are better protected against fraud. Therefore, they should be used for online shopping and other Internet transactions instead of debit cards. Information shared online runs the risk of being stolen by hackers and used without your knowledge or consent. Again, people who suspect their accounts have been used fraudulently should contact the credit card company immediately.
Collection calls only begin once payments have not been made for a significant amount of time. Regular credit checks are a surefire way to stop theft in its tracks. Some criminals can open new cards in the victim’s name; in some cases, the only way a person knows that this new account exists is by seeing it on their credit report. Credit scores are very sensitive to missed payments, and even a fraudulent card can have a negative impact on your score for a while.
