Florida is the most indebted state in the U.S., according to a 2009 research by Forbes magazine. The state has a household median income of $43,333, which is below the national average of $50,233. Yet average credit card debt is $9,797.38. In order to pay off the credit card debt, the Florida consumer will have to give up 22.61 percent of his income, which is unlikely for most households. That is a dilemma for most credit card companies, more so because they have very few legal remedies. Florida debt collection laws are heavily tipped in favor of the consumer.
Wage Garnishment
Some creditors prefer debt settlement with debtors, which perhaps is sensible in a state like Florida. Others still sue even when the odds are against them. In the event of judgment going in favor of the creditor, the only options he has to recover the money is through wage garnishment, lien on the property, or bank account seizure. But the Florida Homestead Protection Articles shields heads of households from wage garnishment. Besides, wages directly or indirectly deposited into your account cannot be garnished or seized until six months after the money was banked. There are also other laws that protect an indebted consumer.
The Statute of Limitation
A creditor has a limited period within which he could collect a debt that is past due. In Florida it is five years for most types of written contracts debt under which a credit card debt falls. Counting begins from the day an activity was recorded on the debt. The creditor, however, is free to take the owing consumer to court in a bid to recover time-barred debt. But judgment is less likely to go in her favor if the debtor uses the statute of limitation as grounds for his defense.
Cease and Desist Letter
When a creditor who receives a Cease and Desist letter or a Power of Attorney continues contacting the consumer, he will be in violation of the Fair Debt Collection Practices Act, which is a federal law. Penalties include up to $1,000. The only time a collection agency or the original creditor can contact you is when new specific remedies are invoked such as a law suite.
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