What legal options can a debt collector exercise in trying to collect an outstanding debt?

When you do not keep up with the minimum monthly payments due on your credit cards or other unsecured debts, the original creditor may decide to charge the delinquent account off.

It may be transferred to one of hundreds of collection agencies or to a law firm that only specializes in collection of debt.

The goal of a settlement program is to negotiate settlements on outstanding debt far below the current balance.  This may be anywhere from 35% to 80%, depending on the debt and many other factors.

The first option a debt collector has is to try to get you to pay as much money as possible.  They use many illegal methods that violate the Fair Debt Collection Practices Act (FDCPA) such as:

• Frequent and harassing phone calls
• Calling at your place of employment
• Mailing threatening letters
• Making threats of lawsuits or other legal action
• Lying by saying that they never work with 3^rd Party Debt Settlement Companies like DRNW, Inc.

We know how annoying these calls can be and have FREE INSTRUCTIONS HOW TO STOP THE CALLS.

The second option a creditor may exercise is to file a claim. 

If a reasonable settlement cannot be reached, the creditor or collector may decide to retain a law firm that specializes in debt collection to file a claim.

This is processed with your local county court (usually small-claims court) and you would receive or be served a summons.  This is a legal document stating that a claim has been filed against you for the debt you owe.

It will state that you have 20 or 30 days to “answer” the claim.  An “answer” is you responding to the claim saying that you do not owe the debt and stating the reason why.

But since 99.9% people who do receive the summons do, in fact owe the money, there is no reason to spend the court fee to file your “answer”.

It is very important that you do not ignore the summons!

If you have received a summons and would like personal, professional help in dealing with it, please let us know!

In most cases, we will work out an agreement in lieu of them going forward with the claim and that will be the end of that.

If a reasonable settlement or agreement cannot be arranged, then the creditor (plaintiff) will be awarded a judgment by default.  You do not have to go to court or hire an attorney (unless you decide to dispute the validity of the claim) and they will win the judgment by default.

Once the default judgment has been awarded, not the creditor has a couple of more options:

If you have a job and are paid normal, W-2 income, they may decide to apply for a writ of garnishment in order to have your employer pay a percentage of your paycheck to the creditor until the debt is repaid.

Each state has a little different law, but in most state, that would be 25% of your net, after-tax income.  There are also different exemptions that may or may not apply.

If you are self employed it is very difficult for a creditor to get a wage garnishment.

If you are retired, they cannot touch your retirement income (more later).

To prevent the creditor from exercising their legal option ONLY AFTER THE JUDGMENT HAS BEEN AWARDED,  you can negotiate an agreement whereby you agree to repay the debt (sometimes at a reduce balance) over time with a payment from your reserve account.

We have many years of experience in helping clients and would be glad to help you also. 

Click here for a FREE EVALUATION.

THE IMPORTANT THING FOR YOU TO REMEMBER IS…

A debt collector cannot just decide to garnish you wages without going through the entire legal process and this usually takes several months, giving us enough time to negotiate a settlement or other agreement.

In rare cased, ONLY AFTER THE JUDGMENT HAS BEEN AWARDED, a creditor may apply for a writ or levy to your bank account.

In short, if you are Retired or Disabled, the creditor (again, only after awarded a judgment) CANNOT TOUCH YOUR BANK ACCOUNT!

But, you cannot CO-MINGLE funds in your checking or savings account.

If you work a few hours here or there, win some money at the casino or receive a gift, DO NOT DEPOSIT INTO YOUR BANK ACCOUNT WITH YOUR OTHER RETIREMEN FUNDS!!!!!

Click a link to a great blog of ours about EXEMPT INCOME.

Debt Relief NW, Inc. is not a law firm and does not give legal advice. 

The Fair Debt Collection Practices Act (FDCPA) provides the consumer with specific rights to protect from debt collectors.

If you have an account that has been charged off and sent to a collection agency, you most likely have experienced the efforts of an unscrupulous debt collector!

Basically, a debt collector cannot:

• Threaten or berate you
• Harass or intimidate you
• Call numerous times or during odd hours
• Make false statements or their intentions ("...we will sue you if you don't pay now!")
• contact neighbors, family or friends about the debt.  They can only state that they are trying to locate you.
• Contact your employer about your debt

How to stop the collection calls:

If you receive a letter from a collector, it will have the name of the company and address.

Write a brief letter stating that you demand that the collector stoop calling you at home (and work if employed) or you intend to report them to your state attorney general.

Date and sign the letter.

Mail by registered mail (you need a receipt proving that the collector received the letter).

Start a phone log and keep a clear record of all calls that come after the receipt of the letter. A collector may call one time after receipt to state they have received the letter and will not call you anymore.

Usually, the make one last threatening remark like, "now you have forced us to start legal action against you...".

Take good notes, because if they do not start legal action, you may have grounds to sue them!

Dealing with debt collectors is a very trying experience and you may need help.

We have been helping our customers for 8 years to:

• Stop the collection calls
• Lower the monthly amount they need to pay
• Negotiate the debt for a 50% or more reduction
• Improve their credit rating as debts are settled

If you need help dealing with your creditors, give us a call TODAY!

1-877-492-4109

If you are behind in your credit card payments, it won't be long before you are contacted by debt collectors!

Here are 3 Illegal Debt Collection Practices to look out for!

#1  CALLING OVER AND OVER AT ALL HOURS OF THE DAY

According to the Federal Trade Commission (FTC) which enforces the Fair Debt Collection Practices Act (FDCPA), collectors are prohibited from using abusive methods to try to collect a debt.

A collectors main tatic is INTIMIDATION and their favorite method is to call several times a day at all hours.

The FDCPA states that a collector MAY NOT contact you before 8am (your time zone) or after 9pm at night.

#2  HARASSMENT

Again, the FDCPA specifically states that a debt collector MAY NOT:

• Use any threat of violence or harm
• Publish your name on a list of people who refuse to pay their debts
• Use obscene or profane language, including telling you how bad a person you are for not paying your bills!

#3  MAKING FALSE STATEMENTS

A debt collector also MAY NOT:

• Falsely claim to be an attorney or government representative
• Implying that you have committed a crime
• Falsely claim that they work for a credit reporting agency
• Tell you that you may be arrested if you don't pay
• Flasely claim that they will seize, garnish or sell your property UNLESS they are permitted by law to take action or THEY FOLLOW THROUGH.
• Send you anything that looks like an official court document if it isn't


What can you do if you have been a victim of these Illegal Debt Collection Practices?

To put a stop the harassing phone calls, you need to send a letter demanding that they stop.

Click here for a FREE GUIDE TO STOP THE CALLS.

You can contact your state's attorney general's office or the FTC to file a complaint. Most state's have separate divisions to handle consumer complaints.  (For example, in Oregon, you would contact the Oregon Department of Justice.)

If you feel overwhelmed, you may want to contact an experienced company that specializes in helping people deal with debt.

The point is...YOU DON'T HAVE TO TAKE IT!

Need help putting a stop to collection calls?  Try this:

Although it is OK and may be advisable to speak with the collector at least once, don't forget that these are trained professionals whose only job is to get money out of you!

Briefly explain your circumstances, but don't be surprised when they seem like they don't care...THEY DON'T!

Ask the collector for a mailing address or fax number.  You probably won't get it as they know you are going to mail or fax a written request for them to stop calling.

According to the FDCPA, once you have mailed or faxed such a letter, they collector may only contact you one more time or they are in violation of Federal laws from the FTC.

In the letter, simply state that at this time, financial circumstances beyond your control make it impossible to pay anything on this debt.

It is also a good idea to state that if things do not improve, you are going to seek bankruptcy protection from creditors.

Make a copy of the letter for your records and mail or fax. 

Although it will cost a little, it is better to send the letter by registered mail so that you have proof that it was received.

As long as your account is still with the original creditor (Visa, Master Card, Citi, etc.) it may take a few weeks for the creditor to process and as a result, you may still get calls.

The best advice is to ignore the calls. 

If you have caller ID (and if you don't, you need to get it), don't answer any calls from callers you don't know.

If you can turn your ringer off and let all calls go to voice mail, then you can screen your calls. DO NOT RETURN ANY CALLS TO A COLLCECTOR, REGARDLESS OF WHAT THEY SAY!

If you would like more information on how to stop collector calls, request  the FREE GUIDE.

I've been getting abusive calls from collectors and want to know: "What are the rules of Fair Debt Collection?"

The Federal Trade Commission (FTC), is the nation's consumer watchdog and enforces the Fair Debt Collection Practices Act (FDCPA). The FDCPA covers almost all debts, but doesn't cover debts incurred to run a business.

Can a collector contact me any time or place about my debts?

NO!  A collector my not contact you before 8am or after 9pm.  They may not contact you at work if they are told (verbally or in writing) that you're not allowed to get calls at your job.

I have told them to stop calling me both at work and home, but they ignore me. Is there anything I can do?

YES!  The FDCPA states that after consumer has requested the collector to stop calling, in writing, the collector must stop or be in violation.

How do I do that?

You need to write a letter and mail it by certified mail. To learn exactly how to do this, click below:

Can a collector contact anyone else about my debts?

A collector may only contact other people to find out your address, phone number and where you work, and they may only do that once!  They are not permitted to discuss your debt!

A collector was abusive and told me that if I didn't send them so much money by the end of the month I could go to jail!

First, no one goes to jail over an unpaid, unsecured debt! PERIOD! That type of language is not typical of collectors, but it does happens from time-to-time.

The FDCPA states that a collector MAY NOT:

• harass, opress, or abuse you or any third parties they contact.
• use threats of violence or harm.
• use obscene or profane language or
• Use the phone repeatedly (calling 10 times/day!) to annoy you
• falsely claim they are attorneys if they are not
• claim that you have committed a crime
• say that you could be or will be arrested if you don't pay
• say that they will seize, garnish, attache or sell your home or property if such action is prohibited by law (99% of the time it is!)
• send you anything like an official document from a court or government agency if it isn'ta government agency.

How to Stop Collection Calls

You've just sat down to dinner and the phone rings.  Another collection call. In fact, this may be the 10th time they have called today! Is there anything you can do about it? YES!

If a collector calls you about a debt, you need to talk to them at least once to see if you can resolve the matter. But be aware...

Collectors are professionals who have been trained with techniques to get you to send them money...PERIOD! They don't care about your circumstances or feel sorry about your problems, so don't wast time trying to explain.

If you cannot resolve the problem by phone (and most of the time you can't), then how can you get them to stop calling?

You will need to get the address of the collector in order to write a letter.  Asking the collector who called for this information usually is a waste of time as the collector knows that you are most likely going to send a request to stop calling you and they do not want you to do that.  Most collectors are paid by commission in relation to the amount of debt they can collect.

You should have received a statement or letter that will have the address of the collector. If not, you should receive one soon.  In the meantime, do not talk with them.  You may want to screen your calls using caller ID or simply turn off your ringer.  You can always listen to your messages later.

Once you have the address of the collector:

• Write a simple letter stating that you don't want the collector to contact you again. Be sure to include your name and account number.
• Make a copy of the letter for your records.  Send the signed orriginal letter by certified mail and make sure to pay for the "return receipt" so that you can document and prove that the collector received your request.
• When the collector receives the letter,they may only contact you once more. They will either call you to tell you that they received the letter and will not callyou again or to let you know how they intend to pursue collection of the debt in the future.