Get a Free Claim Review

Debt Collection Lawyer

Dealing with debt collectors can be tough. You may feel obligated to cater to their whims. However, that should not be the case. The American constitution has provisions that protect the rights of debtors. Debt collection agencies and creditors can sometimes cross a line and cause debtors harm. This is punishable by law and there are both federal and state laws in place to address the issue. Hiring a debt collection attorney in such instances is a good idea as the legal experts can protect your rights and help you obtain compensation for the damages caused by debt collectors.

Understanding the Debt Collection Process

Typically, the debt collection process consists of the following three phases:

  • During the first six months of your delinquency, you will receive and negotiate the terms of debt with the creditor’s internal collector, also referred to as a first-party agency. This is the perfect time to settle your debt and clear your dues with no middlemen involved in the process. It will also help you salvage your relationship with the lender.
  • Once the lender decides on taking an action to get the loaned money, they assign the job to an outside organization, also known as a third-party agency. The creditor continues to own the debt but the responsibility of retrieving it from the debtor falls onto a third-party agency. The third-party agency receives a commission for retrieving a part or whole of the debt as a fee or percentage of the total amount owed.
  • In the last phase of the process, the creditor writes off your debt and sells it to a debt collection agency also known as debt buyers. From this moment on, your creditor leaves the picture and the debt collection agency tries to recoup as much of the debt they can to turn their purchase into profit.

Understanding Your Rights: What Collectors Can and Can’t Do

Debt collection agencies and creditors are permitted by law to use every means of communication available to contact debtors. However, there are certain rules they need to follow while doing so. Debtors, on the other hand, are obligated to pay their dues to the creditors. They can do so by consulting a non-profit debt counseling agency and developing a repayment plan. But during the process, debtors are entitled to privacy and respectful treatment. To protect creditors from harassing debtors, the American Congress passed the Fair Debt Collection Practices Act in 1977. The law prohibits creditors and debt collection agencies from threatening, harassing, and inappropriately and constantly contacting a debtor. The Fair Debt Collection Practices Act protects the debtors in the following ways:

Evidence

Debtors are entitled to demand proof that they owe money to the creditor. Collectors should mandatorily file a claim with proof such as an unpaid bill or any other evidence of a payment violation.

Harassment

It is illegal for a creditor or debt collection agency to harass, abuse, or oppress a debtor by threatening to harm them, using obscene language, or repeatedly contacting the debtor with an intention to pressurize and annoy them. Collectors are not permitted to call debtors between 9 pm to 8 am and at workplaces if the debtor is not allowed to receive calls during work. Contacting the debtor’s friends, family, co-workers, neighbors, or acquaintances is strictly prohibited except if a collector is looking for the debtor’s new contact information or address. The Fair Debt Collection Practices Act also prohibits collectors from publishing debtors’ information. A debtor can use a cease and desist letter to force collectors to stop any and all forms of communication and inquiring about the debts.

False Claims

Debt collection agencies or creditors are forbidden by law from lying to collect debts. For instance, it is illegal for collectors to pose as government representatives, attorneys, or credit reporting agency representatives and claiming that the debtor has committed a crime. Misrepresenting the amount and getting the debtor to pay more than they owe is also a violation of the Fair Debt Collection Practices Act.

Misrepresentation

The Fair Debt Collection Practices Act prevents collectors from pretending to be someone else. There have been a lot of cases reported where collectors have used the pretext of being law enforcement agents, credit reporting officials, or attorneys to force debtors to pay their money. Collectors are also denied making claims about taking legal action that they aren’t about to or permitted to.

Unfair Practices

Debt collectors are forbidden from collecting more money than they are owed or allowed by the state. The act also prohibits collectors from depositing a post-dated cheque early.

Misleading Threats

Collectors are prohibited to threaten debtors with legal actions that are not permitted. Debt collection agencies or creditors can also not threaten debtors with legal actions they intend to pursue.

Wage Garnishment

Collectors are not allowed to garnish wages or bank accounts without a court order. Garnishing wages is a legal procedure that directs an employer to hold a portion of an employee’s funds that are used to pay creditors. Even in case, the court allows wage garnishment, certain federal benefits such as student assistance, social security, and military annuities are exempt from the order.

Misleading Correspondence

Collectors are forbidden from providing false information about the debtor to anyone including a credit reporting agency. Additionally, creditors or debt collection agencies cannot send debtors anything that resembles a legal document but is not one. Conversely, collectors can’t lead debtors to believe legal forms are normal papers.

Right to Sue

The FDPCA provides the debtor the right to sue collectors if they violate any of the abovementioned norms. The debtor can file a case individually or file a class action lawsuit.

What Is the Compensation Can You Receive?

Under the FDPCA, a debtor can be awarded up to US$1000 in damages if the collector violates the debt collection laws. The compensation awarded depends on the frequency, veracity, and the duration of the harassment caused by the collector. The debtors can also receive US$15000 per call made using robocalls under the Telephone Consumer Protection Act.

Other than these statutory damages, debtors can receive additional compensation for emotional distress and stress-related conditions. These conditions may include:

  • Chest constrictions
  • Loss of appetite
  • Angina
  • Embarrassment
  • Anxiety
  • Pain and suffering
  • Humiliation

If the debtor wins the case, the FDCPA permits the debtor to recover attorney fees.

Why Hire a Debt Collection Attorney?

Hiring a debt collection attorney can benefit you in the following ways:

  • With a debt collection lawyer by your side, you can ensure that the creditor is held accountable for all the FDCPA violations they may have committed
  • A debt collection attorney understands how much compensation you can receive for the collector’s violations. With a debt collection attorney, you are assured of receiving the compensation you deserve
  • A debt collection attorney can aid you in drafting a cease and desist letter and put a stop to harassment from collectors.
  • With a debt collection attorney, you can explore and evaluate all the options you can use to penalize collector’s unfair practices

Looking to hire an expert debt collection attorney near you? Fill in the form provided alongside and we will help you in finding the best debt collection attorney near you.