Archive for May 2016
Its almost inevitable that you will encounter at least some form of correspondence from a creditor or collection agency. Luckily there is an important piece of legislation that protects you from vicious collectors. The Fair Debt Collection Practices Act or the FDCPA was first approved in the late 70’s and there are some very specific clauses that protect you the consumer from third party debt collectors.
Read on to find out about some tactics debt collectors might use but are actually illegal…
Many debt collectors will actually resort to threatening a lawsuit against you.
Really this is a “scare tactic” if nothing else. If you’ve ever been threatened with a lawsuit it can be frightening. But did you know that it is actually unlawful under the FDCPA to threaten suit if no such action is actually intended. Under the FDCPA, the attorney cannot sue you in a state that is not your home state. Therefore, the threat is an empty one. And lucky for us these empty threats are actually punishable under the FDCPA!
Even if they are in the same state and do intend to sue you it is unlawful for such a suit letter to be sent unless the lawyer reviews the letter first. Its almost impossible for a lawyer to review the thousands of letters the debt collectors send out. So when the correspondence is not reviewed by counsel, the correspondence violates the FDCPA.
If you have ever received a collection letter threatening legal action you should go back and look at the letters. Were they signed by hand? If not, perhaps they were not reviewed by a lawyer. You may have a case under the FDCPA.
The collector’s threat to “make this go legal” or to “turn the matter over to the legal department” may also violate the FDCPA. If the collector has no designated legal department.
Do you think that the collector may be a collection operation only? If so, perhaps they have no legal department, i.e., the legal aspect is handled outside of the company. In this scenario they would be committing another violation of the FDCPA. This is easy to look into and can help build a case using the regulations found in the FDCPA.
It is also a violation to send a letter stating that the collector will “recommend litigation” or “advise the creditor to sue.” Such correspondences have been found to violate the FDCPA because it, in essence purports to give legal advice to the creditor.
The collector is not permitted to give legal advice, unless, the collector is an attorney.
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The internet, traditional media, TV media, news magazines, and papers are full of useful and accurate information. But, they are also littered with inaccurate and dangerous falsehoods and myths. It’s hard to know what to trust and to believe. And when it comes to credit and credit repair or building credit, much of the information is outright false or inaccurate. For example, have you ever heard or believed either of these two common credit myths?
Credit Myth No. 1: “The credit bureaus are government agencies.”
Completely false. Credit bureaus are for profit companies.
They collect data to sell to lenders and other credit providers, landlords, insurance companies and more. They are not affiliated with the government but are governed under the Federal Trade Commission.
Credit Myth No. 2: “Credit Repair is against the law.”
Again, totally false. Infant, federal and some state laws specifically protect your right to repair and enhance your credit score.
The Federal Credit Reporting Act and Credit Repair Organizations Act both specifically state that it’s legal for you both to repair your own credit, or hire someone to do it on your behalf.
It’s not always easy to repair your own credit. Many people don’t even know where to start. But, if you are a person who can and does do it yourself there are some great resources that will walk you through the issues and the specific steps that you can take.
Click here to get more information on repairing your own credit, a starter’s guide or the full Credit Repair Intelligence Guide.
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