People in serious debt face not only the difficulty of being in a financial crunch, but they frequently face the added stress of harassment from creditors, as well. Many creditors, or collection agencies hired by creditors, seek to compel debtors to pay through a barrage of phone calls, letters and even personal visits. Fortunately, debtors can pursue a number of strategies to protect themselves against harassment.
Types
Credit harassment can be carried out by two parties: the creditors and third-party collection agencies the creditors hire to collect as much of the debt as possible. According to the Fair Debt Collection Practices Act, a federal law that applies to all states, creditors can generally engage in farther reaching practices to collect the debt than can third-party debt collectors.
Features
Based on whether the debtor is receiving calls from a creditor or from a collection agency, the debtor may be able to stop several forms of harassment. For example, under federal law, if the debtor notifies the third-party collection agency that she does not want to receive any more phone calls about the debt, the agency must abide by her wishes.
Prohibitions
According to the law offices of McFarlin & Geurts, debt collectors are forbidden from threatening the debtor with any kind of harm, providing a list of debtors to any party except a credit reporting bureau, using the telephone to annoy someone, using profanity, lying to the debtor about the consequences of not paying a debt, lying to a third party about the debtor, and providing a false name.
Solutions
According to Mark Ankcorn, an attorney who specializes in bankruptcy and debt relief, debtors who have had their rights violated by debt collectors are allowed to file suit against the collectors. Under federal law, the collector can be held liable for any damages he caused the debtor and must also pay statutory penalties of up to $1,000, in addition to any fees that the debtor paid to hire an attorney.
State Laws
Although federal law regulates the actions of debt collectors, many states also have laws that restrict their practices. In California, for example, the Rosenthal Fair Debt Collection Practices Act is written very much like the Fair Debt Collection Practices Act. However, it applies to nearly every kind of debt collector, not just third-party ones. If a debt collector is found to have violated the Fair Debt Collection Practices Act in California, his penalties may double, since both federal and state laws apply.
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