Date: November 1, 2020Author: Joshua Denbeaux
This post comes to you on the Sunday before the national election for the United States president. Happy Halloween! Today we examine areas that are likely to impact many homeowners and consumers in the coming weeks and months: the CARES Act and debt collection.
I’ve written earlier this year about forbearance with the CARES act and how it may or may not be the correct strategy for a homeowner. Recently I’ve explained how the CARES act can stop a Sheriff sale, stop foreclosure, and be used to prevent any judgment against you for up to one year on a federally backed loan. Whatever your situation, know that there are options available to you. You must understand and exercise your rights. I hope to be that resource for you in the days ahead.
The debt collection industry is booming right now. There are forbearances of mortgage debt, student loan debt but not credit card debt.
In this recent post about how identity theft is a crime of fraud, I was very clear about how to deal with errors on a credit report. It is the debt collectors’ responsibility to conduct their business properly. By no means should a consumer expect a company such as a debt collector always to get it right. Unfortunately, accuracy is not a hallmark of some of these businesses. For that reason, there are many cases of debt collectors trying to collect a debt not owed. Using methods against the law and otherwise profiting from reasonable consumer faith attempts to handle the situation on their own.
It is up to the consumer to regularly check their credit report to ensure no problems have arisen from identity theft fraud or error.
Harassment can take many forms. It’s important to know that there are compensatory damages that a consumer can collect for having been harassed by a debt collector and for errors.
The Consumer Finance Protection Bureau (CFPB) is a watchdog government agency that will take the information down of your complaint and report it to the person trying to collect that was the source of the error. Once contacted by the CFPB, hopefully, the problem is resolved.
The difference between these two paths is that the consumer can collect statutory damages for the debt collector not conducting business properly in the case of the first one. If a consumer files a complaint to the CFPB, the CFPB does not act on the consumers to collect compensatory damages.
The only way to do that is to get a consumer rights attorney who will notify the debt collector of the violations under the law and make a case for enforcement to the court. A reasonable consumer rights attorney will sue the debt collector and their lawyers if appropriate. In many cases, only the debt collector is held accountable for any misdeeds and trying to collect a debt, but their law firm may represent them in a case.
The statutes that impact the consumer are the Fair Debt Collection Practices Act (FDCPA), Fair Credit Reporting Act (FCRA), and the Telephone Collections Practices Act (TCPA). All three of these laws work together to protect the consumer.
The Telephone Consumer Protection Act (TCPA) controls how a debt collector may contact you via the phone. The TCPA covers a large area of abuse and harassment specifically about phone calls. Behavior by debt collectors as their efforts to locate the person owing the debt, inform them of the debt, and then attempt to collect the debt is the bread and butter of their business. The TCPA is specific about who, what, when, and how to talk to consumers on the phone about a debt. Violations of these things result in statutory and compensatory damages.
The biggest thing that a consumer needs to know about Consumer Laws IS THEY ARE FEE SHIFTING. The FCPA, FCRA, and the TCPA – all of these laws have fee-shifting.
Fee-shifting enables a consumer to retain a lawyer to represent them in these matters without incurring expenses for attorney fees. When the consumer rights attorney wins the case, the debt collection pays all fees.
That means that if you have a claim, YOU CAN SUE. You don’t come out of pocket for the best attorneys you can find; we make the banks and the creditors and the debt collectors pay.
Debt collectors are miserable to deal with … anyone and everyone who has been in the situation where they are behind on a debt – those calls and letters are awful. If you have questions, reach out to me! I can tell you whether the debt collector is violating the law …
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