Posts Tagged ‘creditor harassment’

When the Collection Agent Calls

Jun 12, 2010 • No Comments • Personal Finance

Under the Fair Debt Collection Practices Act (FDCPA), debt collectors are prohibited from using abusive, unfair, or deceptive practices to attempt to collect on debts.  Under the FDCPA, a debt collector is someone who regularly collects debts owed to others.  This includes collection agencies, lawyers who collect debts on a regular basis, and companies that buy delinquent debts and try to collect on them.

WHAT DEBT COLLECTORS MAY DO

Debt collectors have the legal right to demand payment from you and to threaten legal action, if necessary.  The FDCPA, however, prohibits harassment and misrepresentation.  Moreover, debt owners, collection agents, and third party collectors must all follow these rules.

Debt collectors may only call you between the hours of 8:00AMand 9:00PM.  Collectors may not make excessive calls.

WHAT DEBT COLLECTORS MAY NOT DO

First and foremost, debt collectors may not use profane or abusive language to convince or coerce you into make payments on a debt.  In reality, my clients have reported gross violations of this aspect of the FDCPA. 

In theory, debt collectors are also prohibited from attempting to make you pay more than you actually owe.

Debt collectors may not misrepresent themselves to be from a government agency or a court of law.

Collectors are absolutely prohibited from notifying your employer that you have an outstanding debt.  Debt collectors may, however, contact your friends, coworkers, and neighbors, in the attempt to fnd a way to get in touch with you.  Again, I have heard horror stories about the disturbing lengths that collection agents will go to contact a debtor.  (For more, read my article on skip tracing tactics employed by debt collectors.)  If you fall behind on your bills, it is usually better to beat creditors to the punch than to allow them to run roughshod over your life for several months.

WHAT YOU CAN DO

You can instruct the collector to stop calling you while you are at work.  You should do this in writing, and preferably, by registered mail.

If you retain counsel to negotiate with your creditors, then your creditors must stop calling you and instead go through your counsel.  If creditors are infringing on your ability to live your life, give me a call at (202) 448-5136 or visit the Lee Legal website for more information.   As a bankruptcy and debt attorney in D.C. and Virginia, I can help you get your creditors off your back.

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The Automatic Stay

May 22, 2010 • No Comments • Bankruptcy

If you are considering filing bankruptcy in D.C. or Virginia, you should be aware of a nifty feature of bankruptcy called the “Automatic Stay.”  Whether you file for Chapter 7 or Chapter 13, the Automatic Stay directs your creditors to cease all collection activities immediately or face court sanction. 

If your home is scheduled for foreclosure, the auction will be legally postponed while the bankruptcy is pending, typically for three to four months.  In addition, the Automatic Stay stops all action by creditors to collect on debts:

  • Once the Automatic Stay is in place, creditors cannot call your home, cell phone or place of work.
  • Creditors may not even mail to your home. 
  • If the creditor has sued you, the lawsuit will be stopped pending the outcome of the bankruptcy.
  • Creditors cannot collect on judgments or pursue new collection actions.
  • If the creditor has garnishmed your wages, the garnishment must stop immediately.
  • Creditors cannot lien against your home or levy your bank accounts.

In short, the Automatic Stay buys you some peace of mind by immediately ceasing all collection efforts and creditor harassment.  If a creditor, creditor’s attorney or collection agent violates the Automatic Stay, then they run the risk of sanction by the Bankruptcy Court.  Penalties for violating the Automatic Stay can include money damages and attorney’s fees.

As a bankruptcy lawyer in Washington, D.C.. I can explain to you how the Automatic Stay can help you get your creditors off your back.  Give me a call at (202) 448-5136 or visit the Lee Legal website for more information.

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Top Three Reasons to File Bankruptcy

May 18, 2010 • No Comments • Bankruptcy

If you are considering filing bankruptcy in D.C. or Virginia, you should contact Lee Legal and schedule a free consultation.  I understand that bankruptcy is not appropriate for everyone, and as a bankruptcy lawyer, my primary concern is to explore all of your options to determine whether bankruptcy is the right option for you.  No one intentionally chooses to face severe financial hardship.  Here are the Top Three Reasons to File Bankruptcy.

Reason 1:  BANKRUPTCY ENDS CREDITOR HARASSMENT

Constant calling and condescending harassment from creditors can develop into a major problem.  Creditors will call you at home and at work, and with the recent rise of skip-tracing, they will also call your family, friends, neighbors, and colleagues.  Creditors will relentlessly pursue you and demand payment despite any financial hardship or specific circumstances.

Filing bankruptcy puts an immediate stop to creditor calls and correspondence, no excuses.  If a creditor contacts you while you are in bankruptcy, then that creditor has violated an order of the court, and is in big trouble.

Reason 2.  BANKRUPTCY REDUCES STRESS

Bankruptcy is often the result of life-altering events: unemployment, illness, family hardship, foreclosure, garnishment, divorce.  All of these situations are extremely stressful.  But bankruptcy can put you back on the right track.

The knowledge that you are taking a proactive approach to solving your financial problems will go a long way.  In addition, from the moment you file bankruptcy, your creditors are forbidden from attempting to collect on debts.  All repossession and foreclosure efforts must immediately cease, and garnishments and lawsuits can be halted.  The very act of filing bankruptcy can relieve you from an enormous amount of stress.

Reason 3.  BANKRUPTCY CAN HELP YOU MANAGE YOUR DEBTS

Some debts, like student loans and child support, cannot be eliminated by a Chapter 7.  Some people make too much money to qualify for a Chapter 7 bankruptcy and must instead file a Chapter 13 and submit a repayment plan.

Whatever form of bankruptcy you file, the fundamental goal is to restructure your finances and to free you from debt.  Filing bankruptcy can be a difficult decision, but the benefits often outweigh any potential downside.

CALL A BANKRUPTCY LAWYER IN D.C. NOW

Filing bankruptcy in D.C. or Virginia can be a complicated process.  If you are considering filing bankruptcy as an option, call Lee Legal at (202) 448-5136 to discuss your options.

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Debt Settlement is a Rip-Off

May 15, 2010 • No Comments • Personal Finance

While there is no independent research into the success rates of so-called “debt settlement” companies, company reports and anecdotal evidence suggest that fewer than one in four of those who hire these companies actually complete their programs.  Even more troubling, up to 10% of debt settlement clients are sued by their creditors while in a debt settlement program.  Here’s the way these companies are supposed to work.     

Debt Settlement Companies Are RipoffsFirst, the debt settlement company gets paid.  They typically charge several hundred dollars as an initial “administrative fee” to set up your account.  In addition, they will charge you a monthly service fee.  The company requires a monthly payment, however instead of sending this money to your creditors, the company keeps your money in trust until there is enough to pay a creditor either the entire balance of your debt, or some agreed-upon reduced amount.    

Unfortunately, this process can take several years to complete, depending on the number and amount of debts you owe.  In the meantime, your creditors can sue you, garnish your wages, and continue to harass you.  In addition, during the entire “debt settlement” process, interest and fees will continue to accrue.  It is not very surprising that so few of these programs succeed.   

The Washington Post recently reported that debt settlement scams are on the rise.  Advocacy groups say the industry’s advance-fee model and lack of regulation have allowed unscrupulous firms to take advantage of desperate customers.  Bankruptcy is very frequently a much better option.

People do not choose to put themselves into unfortunate financial situations, but debt settlement companies often make bad situations worse.  These companies collect huge fees, grow debts, damage credit scores, and in the end, typically fail.  Bankruptcy, on the other hand, offers immediate protection from collection efforts, ends garnishments and lawsuits, and allows you to start getting your finances back on track almost immediately.  The typical Chapter 7 also takes about three months to complete, which is far less time than the typical debt settlement plan.   

If you are considering either debt settlement or bankruptcy, a good first step is to schedule a free consultation with a bankruptcy lawyer.  Licensed in Washington, D.C. and Virginia, attorney Brian Lee can help you assess your financial options.  Call 202-448-5136 or email bvlee@lee-legal.com. 

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What is Skip Tracing?

May 14, 2010 • 2 Comments • Debt Collection

Skip tracing (or “skiptracing”) is the imprecise and frequently inartful process of locating a person’s whereabouts by whatever means available to the skip tracer.  Skip tracing tactics are most often employed by debt collectors, although the methods are also used by law enforcement, private investigators, bounty hunters, and journalists. 

The “skip” in skip tracing has two meanings.  First, skip tracing is often employed to locate those persons who have “skipped town,” or moved to a new residence in a way that has escaped the attention of parties interested in that person’s location.  Second, the “skip” in skip tracing refers to the “skipping” between often scarce or minimal pieces of information and persons available to the skip tracer. 

Skip tracers typically have access to huge commercial databases, credit reports, criminal checks, and public tax records.  In addition, skip tracers will ultimately resort to power of subpoena to access otherwise unavailable information, such as utility records, government job application information, utility bills, and social security and disability records. 

To locate a subject, skip tracers will call and/or correspond with current and former employers, family members, landlords, neighbors, and personal and professional associates of all kinds.  Skip tracers often conceal their true identities and motives in order to gain more information.  This form of deception, known as “pretexting,” is legal in both Washington, D.C. and Virginia.

If you are being harassed by your creditors and their agents, or you suspect that you are being targeted by a skip tracing company, then I may be able to help you.  As a bankruptcy lawyer in D.C., I can help you by putting an immediate stop to all collection efforts, including the shady practices of skip tracers.

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