Warding off creditors chasing overdue debts can feel like a lonely battle. But the truth is, more than one-third of Americans are barely keeping their heads above water. A recent study revealed 35 percent have a debt so far past due the account has been placed into collections.
Miami debt defense lawyers at Jacobs Keeley know the problem is especially pronounced here in South Florida, one of the hardest-hit states during the housing crisis and Great Recession. Here, more than 40 percent of debt is in collections, which is substantially higher than the national average. People are continuing to claw their way out, but wages are stagnant, costs for goods are high and creditors aren’t cutting anyone a break.
But avenues of support are available. Consumers are entitled to protections against unfair debt collection practices and unfair credit reporting. Our credit defense attorneys are experienced in taking on creditors who violate your rights under the Fair Debt Collection Practices Act (FDCPA), the Fair Credit Reporting Act (FCRA) and the Florida Consumer Collection Practices Act (FCCPA).
It’s important to note second-hand buyers of debt often pursue collection and litigation with little or no evidence to prove the money is owed. An experienced lawyer can help you to not only refute such claims, but also potentially file a counterclaim to recover damages – including attorney’s fees.
Additionally, if you prevail in a collection action, your credit should be restored.Fair Debt Collection Practices Act
If you are behind on your bills, or if there is a creditor record that wrongfully indicates you are, it’s likely a debt collector will be contacting you. When they do, they are bound by the Fair Debt Collection Practices Act (FDCPA), which is enforced by the Federal Trade Commission.
The debts covered under the act include:
- Personal credit card debts
- Auto loan debts
- Outstanding medical bills
- Overdue mortgage payments
- Old utility bills
- Most other personal and household debts.
After 180 days, these debts are typically sold to a third party collection agency for pennies on the dollar. Those firms turn around and pump consumers to pay the full amount.
Reminding consumers of a past due debt is one thing. However, these efforts often cross the line, which is why lawmakers passed the FDCPA in 1996.
Under this law, creditors may not harass you, make false statements or engage in unfair practices. Some examples of prohibited collection actions:
- Threaten physical violence or harm;
- Publish public lists of those whose debts are unpaid (though this information can be given to credit reporting firms);
- Curse at you;
- Repeatedly call you on the phone with the intention of annoying or harassing you;
- Falsely claim to be a lawyer, police officer or other government agent;
- Lie and say you’ve committed a crime or threaten you with arrest;
- Misrepresent the amount you owe;
- Threaten legal action unless they are actually permitted by law to do so and have intentions of filing litigation;
- Use false company names;
- Try to collect any fee, interest or other charge on top of what you owe unless the contract that created the debt allowed for it.
These are just some of the prohibitions laid out under the FDCPA.
However, it is possible – and quite common – for a creditor to sue for the amount owed. If a judgment is rendered against you, that creditor can garnish your wages and direct your bank to turn over your funds to cover the balance of that judgment. This is why you must never ignore a notice of a lawsuit filed by a collection agency.
On the other hand, any violation of FDCPA rules is grounds for you to file civil litigation against the collection agency. You will not have to prove actual damages in order to win, but you will need an experienced attorney by your side.Florida Consumer Collection Practices Act
The Florida Consumer Collection Practices Act (FCCPA) supplements the protections provided in the FDCPA. In other words, the state law provides consumers with even greater protection.
For starters, the law requires all debt collectors (including those operating out-of-state) to be registered with the state, though exceptions are made for original creditors, banks, attorneys and real estate and insurance professionals.
Companies can’t knowingly hire an unlicensed collection agency to collect a debt.
Additionally, collections agencies can’t contact third parties regarding your debt unless that third party is your attorney. And if you do have a lawyer representing you, the collection firm is not allowed to contact you directly anymore.
They also can’t file litigation in the wrong venue (making it tougher to defend yourself), and they can’t contact you between 9 p.m. and 8 a.m. without your permission.Fair Credit Reporting Act
Legislators have long recognized that good credit is a cornerstone of financial health. If someone has a bad credit score, it can affect the quality and availability of loans, as well as interest rates. It can also impact job opportunities and the ability to secure a lease for a home or vehicle.
That’s why the Fair Credit Reporting Act (FCRA) regulates the degree of access others have to your credit, as well as outlines your rights to obtain information in that report and, if need be, dispute it.
The law says your credit file is strictly limited to those who have a valid need to access it. Usually, that includes potential creditors, insurers, employers and landlords. If information in the file has been used against you in some way, you have to be informed of it.
You also have the right to request your credit score and receive full disclosure of the file. As well as the right to dispute any items you believe are inaccurate or incomplete. And, if an employer wishes to run a credit check, you must provide consent.
If you're battling debt collection or unfair reporting in Miami or the surrounding areas contact Jacobs Keeley Trial Lawyers for a confidential appointment to discuss your rights.
Call us at (305) 358-7991.