ABOUT DEBT COLLECTION COMPANIES
Debt collectors can be divided into two types; the original creditor and the junk-debt buyer. The original creditor had some business transaction with the consumer. The junk-debt buyer is a stranger to the consumer and hopes to make enormous profits.
Junk-debt buyers buy old credit card and other accounts already written off by the original creditor. The junk-debt collector contacts the consumer and attempts to collect the debt. If it is not successful, then it files a lawsuit to collect the debt. The fact that the junk-debt buyers have to prove standing in court in order to collect the debt is their greatest downfall, since they seldom have sufficient documents to support the claim. If the debt has been sold more than once, then the documentation that the debt buyer will have to produce to establish the chain of assignment may be difficult if not impossible to accomplish. In order to overcome this problem, the debt buyer usually produces a one-paragraph document entitled something like a “bill of sale.” This “bill of sale” generally makes no mention of the specific debt but instead references a separate section, exhibit or document to identify the specific debt. These referenced items are rarely produced.
It is not uncommon for a consumer to be sued on an account that they never owned, get sued long past the statute of limitations, or get sued on a debt that was previously discharged in bankruptcy. It is for the foregoing reasons that any person served with a complaint by a debt collector should seek legal advice and fight it vigorously.
PARTIAL LIST OF DEBT COLLECTORS
BH Financial Services, LLC
Asset Acceptance LLC
CACH, LLC
Cavalry Portfolio Services
Cavalry SPV I, LLC
EGC Financial LLC
Equable Ascent Financial, LLC
Fulton, Friedman & Gullace, LLP
GCFS, Inc.
LVNV Funding, LLC
Gotham Collection Services, Corp.
Main Street Acquisition Corp.
Midland Funding, LLC
MTC Group
National Credit Adjustors, LLC
Newport Capital Recovery Group III, LLC
Palisades Collection, LLC
Persolve, LLC
Portfolio Recovery Associates
Pride Acquisitions, LLC
PVOD, LLC
Razor Capital, LLC
Resurgence Capital, LLC
Steamboat Partners, LLC
Thunderbolt Holdings, Ltd.
Unifund CCR Partners
Velocity Investments, LLC
ABUSIVE AND HARASSING DEBT COLLECTORS
If you have fallen behind on the payment of your credit cards or other consumer debts, a natural reaction may be to ignore the problem with the hope that somehow it will go away. It will not go away. You will receive telephone calls -- a lot of telephone calls -- and letters. In response, you may simply stop answering the telephone and throw away the letters or stuff them in places where they cannot remind you of the problem. Unfortunately, the problem will not go away. So, before you get sued, you need to open, read and save all correspondence that you receive from the debt collector; as you will probably need these later.
CALIFORNIA AND FEDERAL PROTECTION AGAINST DEBT COLLECTORS
If you live in California you are protected by California law and Federal law. California expands the federal protection because it applies to the original creditor as well as to a debt collector to whom the original creditor has sold the debt.
A Debtor Collector Can Call You Only During Certain Hours
The collector’s most powerful tool is the telephone and it will use it. However, a collector can only call you between 8:00 a.m. and 9:00 p.m. If these hours are not good for you, tell the debt collector to contact you at other times. There is no law that limits the number of calls a debt collector may make, but repeated calls over a short period of time may be considered harassing, and are prohibited. When a collector calls, you should make notes of the telephone conversation. When you end the call you should make a summary of the telephone call and also include the date and time of the telephone call. You should also note the name and company that made the call.
A debt collector cannot contact you at work if you tell them not to do so. This can be done orally but it is better to do it in writing. If you correspond with a debt collector, it is important that you do two things: (i) keep a copy of your correspondence, and (ii) send all correspondence using certified mail return receipt so that you have a record of what you sent and when you sent it.
You Can Stop a Debt Collector From Calling You
If you simply do not want to be contacted by a debt collector, you can write a letter to the debt collector telling him to stop contacting you. Once the collector receives your letter, it may not contact you again, with two exceptions, a collector can contact you to tell you there will be no further contact or to let you know that they intend to take a specific action, like filing a lawsuit. Keep in mind that the creditor or debt collector can still sue you to collect the debt.
A Debt Collector Can Contact Only Certain People
A collector can contact people other than yourself, but only to find out your address, your home phone number, and where your work. Other than to obtain this information about you, a collector is not permitted to discuss your debt with anyone other than you, your spouse, or your attorney.
What Is a Debt Collector Prevented From Doing
Harassment: Debt collector may not harass, oppress, or abuse you or any third parties they contact. They may not:
use threats of violence or harm;
use obscene or profane language;
make repeated telephone calls.
False Statements: Debt collector may not lie when they are trying to collect a debt. They may not:
falsely claim that they are attorneys or government representatives;
falsely claim that you have committed a crime;
falsely represent that they operate or work for a credit reporting company;
misrepresent the amount you owe;
indicate that papers they send to you are legal forms if they are not;
indicate that papers they send to you aren’t legal forms if they are.
Debt Collectors Cannot Say That:
you will be arrested if you do not pay your debt;
they will seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so.
you will be arrested if you do not pay your debt;
they will seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so.
What Can You Do If the Debt Collector Has Violated the Law?
If the debt collector has violated California or Federal law, you can sue the debt collector within one year from the date of the violation. If you win, you can recover damages for your loss, court costs, and attorney’s fees. Remember that the one-year rule period runs from the date the debt collector violated the law.
ILLEGAL TELEPHONE CALLS TO YOUR CELL PHONE BY DEBT COLLECTORS
The Telephone Consumer Protection Act (TCPA), 47 U.S.C.§ 227, prohibits a collection agency from calling you by auto dialer, leaving pre-recorded message on your telephone, sending you unwanted text messages, and/or sending you unwanted advertisements via fax, also known as junk faxes. Specifically, the TCPA prohibits the following
♦ Auto-Dialer Calls to Cells Phone: The TCPA prohibits auto-dialed calls to your cell phone. An auto-dialer uses a software program that is used to automatically call numbers that are listed in a computer. Once the call is answered, the program will connect the recipient of the call with a live person. If you receive one or more of these calls, they are characterized by a 1 or 2 second delay before the live person connects, there is hold music when you answer, there is a voice recording asking you to hold, and/or if a live person comes on the line and appears to not know they just dialed you.
♦ Pre-Recorded Voice Messages to Cells Phone: The TCPA prohibits a collection agency from calling your cell phone with a pre-recorded message. If you answer your telephone and you hearing a recording then such a call is illegal unless it is an emergency call or you have consented to receiving such a call.
♦ Damages: Victims of TCPA violations are entitled to statutory damages of $500 per violation even if the debt collector’s actions were not intentional. If deemed intentional or willful, statutory damages are $1,500 per violation. In addition, violators are subject to attorneys’ fees, litigation expenses and costs of the lawsuit.
INCORRECT REPORTING OF YOUR CREDIT STATUS BY CREDIT REPORTING AGENCIES
The Fair Credit Reporting Act, 15 U.S.C. § 1681 (FCRA) regulates the collection, dissemination, and use of consumer information, including credit information.
♦ Major Credit Bureaus: There are three credit bureaus--Experian, Equifax and Trans Union—that have files on almost everyone's credit history. Too often, the files have inaccurate information. The FCRA provides consumers with the right to ask the credit bureaus to correct their records. The procedure is to first send letters to the credit bureaus describing the inaccurate information. The credit bureaus should then check with the company that provided the erroneous information. The company furnishing the information is supposed to investigate the dispute and resolve it. However, this does not always happen.
♦ Common Reporting Errors: Some consumers' credit reports are inaccurate because the credit bureaus have mixed the files of two different individuals. Other consumers' reports are wrong because their identity has been stolen. Other consumers' files are inaccurate because debt collectors have "re-aged" old debts so they stay on the consumers' credit reports long after they should have been removed.
♦ Impermissible Purpose: The FRCA also protects consumers whose credit reports were provided to people who do not have a legal right to look at their reports. Requesting a consumer's credit report without their permission and without a legal "permissible purpose" is a violation of the FCRA.
Debt Collection Lawsuit?
Have you been sued by a Debt Collection Company? If so, we are here to help.
We offer a How-To Video that provides general instructions on how to deal with a debt collection matter and specifically it provides step-by-step instructions on how to complete and serve the answer to a debt collector complaint.