Category : Credit Cards, Debts, Negotiations, & Settlements

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What Is Predatory Lending, And What Can I Do About It?

Everyone is out to make a profit, and this includes banks and other lenders. The way a lending institution makes money is by making loans. The interest received on loans that are not paid in full monthly adds up quickly, and is a major revenue source for creditors. This is why you receive “offers” in the mail for everything from car and home loans, to loans that will pay for your vacation. If you are able to make the payments, and the terms are favorable, this type of advertising is harmless. But, when the terms are unreasonable, or the lender deceives you into making the loan that problems arise.

The practice is referred to as predatory lending, and some of the signs include:

● Fees in excess of the standard fees for the type of loan, a loan made to someone with a credit score similar to yours, and a loan made in your geographic area.

● Penalties if you pay off the loan before its maturity date.

● Loans by companies that advertise things like “bad credit OK”.

When talking about a mortgage loan, if you are not given the chance to escrow your taxes and insurance you should also question whether the loan in question is the right one for you. It also a good idea to be wary of loan structures that pay off higher rate debts by repeated refinance attempts. The more often you rely on the equity in your home for income, the more likely you are to end up without any equity at all. This can make resale difficult, and leave you with few financial choices. Lenders that gloss over these concerns may be engaging in predatory lending, and you should get a second opinion. There are laws against these practices, and if you have been the target of a predatory lender, you can take action to recovery any damages you’ve suffered.

Call a Plantation, Florida debt relief attorney today for more information on your legal options against a predatory lender. We help you understand the process and work towards results that make sense. Schedule an appointment to learn more.

 

 

Can Older Debtors Avoid Collection?

Having debt is not limited to a certain age group. This is especially true in today’s economy, where it is becoming more likely that people work well beyond retirement age in order to continue paying their bills. The law does not discriminate between who is sued for a delinquent debt, and who is not, just because of their age. The unfortunate result is that a good number of the elderly are being made to answer collection lawsuits, and they are doing so without fully arming themselves with the knowledge needed to obtain satisfactory results.

While the options to avoid collections may be limited, depending on your circumstances, there are some important things senior citizens should know about the process. Not only is social security not subject to attachment by a wage or bank garnishment, but there are other forms of income that are exempt. SSI is also not subject to being garnished, and it is also a form of supplemental income that should be explored in order to boost an elderly person’s bank account. SSI is available for:

● Blind, aged, or disabled persons with little to no income.

● Provides funds to meet basic needs.

Federal disability payments are also yours to keep, and cannot be garnished or taken from you. If you are being asked to make payments from any of these sources of income, or are being garnished and your only income are these sources, you can seek to have the monies returned to you. One way to avoid these consequences in the first place is to keep the lines of communication open with your creditors. Providing the information about the source of your income before legal action is taken may prevent a creditor from proceeding further. Before deciding how to respond to collection efforts, consult with a qualified debt relief attorney to learn your options.

If you have questions about how to avoid collections and what income sources are off limits, call our office for help. Call a Plantation, Florida debt relief attorney today for more information.

What To Do When Collection Efforts Persist After Bankruptcy

The purpose of filing bankruptcy is to give the honest, but unfortunate debtor a fresh financial start. The goal is discharge of debt, which means debts that were once due are no longer required to be paid after the bankruptcy case is over. When you file bankruptcy, your creditors are given notice and they are prohibited from contacting you to collect what is owed. This is also true after the bankruptcy is over. Upon receiving a discharge of debt, the creditor can no longer seek recover the balance of the loan. However, there are instances where a creditor continues to call or send letters, and if you are in this situation you should take action against the creditor.

Because the bankruptcy discharge acts as an injunction against future collection of the debt, if  a creditor persists in doing so, you can file a case against that particular creditor. Some common causes of collection efforts after the discharge include:

● The debt being sold to a party that is unaware of the bankruptcy.

● Poor record keeping by the creditor.

● The debt was not listed in your bankruptcy, even though it was owed when you filed.

Sometimes simply advising the creditor of the bankruptcy information will stop the calls. This can be the case for a creditor that bought the debt from the original lender, but was not advised of the bankruptcy filing. In that instance, providing the case number and discharged date may do the trick. For debts that were inadvertently left off your bankruptcy, the Court still considers them discharged and advising the creditor as such should stop the collection efforts. However, there are cases where educating the creditor about the filing and discharge don’t work, and collection tactics continue longer after your bankruptcy case has ended. When that happens, you have the right to sue the creditor for violating the discharge order, and you can recover monetary damages for the violation. A trained consumer bankruptcy attorney can help in this endeavor, and will fight for the compensation you deserve.

If you are being contacted for payment of a debt discharged in bankruptcy, call a knowledgeable attorney to discuss your options. We can help you understand your choices and make a decision that works for you. Call a Plantation, Florida debt relief attorney today for more information.

What Is The Difference Between Consumer And Commercial Debt?

Not all debt is taken out for personal use, businesses also incur debt in their daily operations. And, just like in the case of personal (or consumer) debt, when a business does not pay its debts, the lender will seek to collect. Commercial debt collections are similar to consumer actions, but there are some differences. For instance, the law presumes a business owner to be more savvy than the average consumer, and so the laws regarding collection practices typically do not apply to commercial collections.

The most important law regarding consumer collections is the Fair Debt Collection Practices Act. The Act prohibits certain actions by creditors when collection debts incurred for personal, consumer purposes. The following are among these prohibitions:

● Abusive or harassing collection tactics, including threats.

● A notice regarding the consumer’s right to dispute the debt must be provided.

● The consumer must be given the opportunity to request the balance, and the name of the original creditor if it is different than the entity undertaking collection activity.

These protections are not afforded businesses, for commercial collections. This means, if you are a small business owner and are experiencing financial difficulty, you must act quickly to protect yourself from collection efforts. The amount of time for a consumer to dispute a debt is longer than that for a commercial debt, which means if you are sued you have a shorter amount of time to answer. Failure to answer will result in a default judgment being entered against your company, which could result in garnishment of your banking accounts. Call a knowledgeable attorney today to protect your business.

 

If you have questions about the difference between consumer and commercial debt, call our office for answers. Call a Plantation, Florida debt relief attorney today for more information.

Is The U.S. The Most Debt Laden Country?

It has been said over and over again that the U.S. is the most overweight country, but does this apply to areas other than the number of pounds the average American carries? With the country’s economy on the rebound is it safe to say other countries have more consumer debt than here in the States? And if so, how will the amount of consumer debt carried by foreigners impact the American economy and growth prospects?

The debt crisis in other countries applies not only to individual consumers, but to the governments as well. Even so, there are ways other countries outside the U.S. manage their debt. Some popular methods include:

● Living on a cash only basis.

● Refusing to take out additional debt until existing debt is paid in full.

● Avoiding high dollar purchases such as new cars or homes.

● Sharing the family home with extended family.

These tactics and ways of life may seem tempting, and with different tax laws in place many citizens are considering moving overseas to escape overwhelming debt. The problem with this plan is that your debt will follow you and making this kind of move requires cash. Because cash is a rare commodity for people with large amounts of debt, moving out of the country and starting over on a cash basis is not usually possible. The better way to manage debt is to tackle it head on and get back on solid ground. A debt management attorney can help you explore your options, whether what works best for you is bankruptcy or loan modifications, and make a decision that is doable.

If you are unable to meet your monthly obligations as they become due, call our office for help. We will review the facts of your unique circumstances and develop a strategy that fits the facts of your case. Call a Plantation, Florida debt relief attorney today for more information.

I Disputed The Debt And Got Garnished Anyway: What Can I Do?

Being sued for debts is a stressful experience. No payment of debt is not an intentional act, but usually comes about due to unforeseen circumstances. For most people an unexpected life circumstance leads to debt quickly piling up, which is impossible to pay. All it takes is one catastrophic event, such as being diagnosed with cancer or being in a serious accident, for your finances to take a tumble. If you have received a demand for payment, the first step you should take is to dispute the debt and request the creditor provide what is due. This is the only way to ensure you are paying a legitimate debt and that the amount is accurate.

Even though it is your legal right to dispute a debt, some creditors proceed with legal process despite your dispute. When left unanswered, a demand for payment can escalate to a lawsuit. If you fail to defend the lawsuit a judgment can be entered against you and once that happens the next step is garnishment. To put an end to a garnishment on a disputed debt, take the following steps:

● Challenge the garnishment itself and seek to be exempt from being garnished.

● File a motion to vacate the judgment against you.

● Bring an independent action against the creditor for wrongful collection.

The options you have depend on how long it has been since the judgment was entered against you, and at what time the garnishment was issued. The rules of civil procedure will dictate your choices, and a skilled debt relief attorney can help figure out where in the stage your case is and advise your legal options. Call us for more information and for a review of your case.

Did The Lender Have The Right To Foreclose: The Standing Issue

All legal cases begin with an injured person and a responsible party. This is true whether you are talking about a car wreck, a breach of contract, or a criminal matter. In order to seek recovery for an alleged wrong, the person filing a lawsuit must have standing to do so. This legal term of art means that the person or entity suing has the right to do so, either by being the injured party or by holding a contract or other piece of paper that gives legal rights. When determining whether a lender has standing to file a foreclosure, several factors must be present.

This issue first came to forefront of the legal landscape right here in Florida. In 2007, when foreclosure rates were at an all-time high, important information about lenders’ foreclosure practices came under heavy scrutiny. To recap, the issue was as follows:

● Evidence was uncovered showing that lenders were having employees sign affidavits to start the foreclosure process without having any actual knowledge of the loan status. This was the so called “robo signing” scandal.

● Many lenders were not actually in possession of any obligatory documents that would give them the right to enforce payment. Without a right to enforce payment, there is no right to foreclose the mortgage.

● Most foreclosing plaintiffs were merely servicing loans, and not entitled to accept payments. This was problematic because only the entity entitled to payment has the right to file a lawsuit for nonpayment.

While many lenders have changed their practices, there are still untold numbers of instances where a foreclosure is initiated by a plaintiff without the right to do so. If you have questions about whether the entity suing you for foreclosure has standing to do so, you should challenge the entire procedure. Doing so requires requesting to be shown the original note and that the plaintiff was in possession of the note prior to suing you. This process requires careful legal analysis and the assistance of a skilled legal professional.

If you are being foreclosed on and believe the case is wrongful, call our office for help. We will review the facts of your unique circumstances and develop a strategy that fits the facts. Call a Plantation, Florida debt relief attorney today for more information.

Was The Foreclosure On My House Wrongful?

Losing your home deals a harsh blow to your family. With the massive increase in foreclosure filings in recent years, more and more courts are taking extra special care to make sure the foreclosure is done properly and without glitches. If you believe the foreclosure on your home is wrongful you can and should challenge its validity. Doing so will ensure the process proceeds as it should and that the result is correct.

Florida foreclosures, like every other state, should only be initiated by the lender that has the right to take back possession of the home. Common errors made by foreclosing lenders include:

● Foreclosing without the proper documentation.

● Foreclosing on an active duty military member.

● Failing to account for the amount due or being able to prove the note is in default.

● Starting a case with documents that were not signed by you (either a forgery, or simply not signed at all).

If you have any doubt as to whether the foreclosure on your house is proper, call our office. When things don’t seem right, they usually aren’t. You have the right to make sure the lender has the right to foreclose on you and that they provide proof of the debt as well as the amount they claim to be past due. You are entitled to an accurate pay history and to see the originals of the loan documents. When a lender fails to abide by the rules and regulations governing foreclosures, the process should go no further. This has been the general feeling across the country and the courts are not ignoring the severity of displacing people from their homes. This is your “day in Court” and you should take full advantage of the opportunity to challenge the possible loss of your home.

 

If you are being foreclosed on and believe the case is wrongful, call our office for help. We will review the facts of your unique circumstances and develop a strategy that fits the facts. We offer an individualized approach and work with you to reach satisfactory results. Call a Plantation, Florida debt relief attorney today for more information.

How Do I Sue A Debt Collector?

Most collection lawsuits involve a creditor suing a consumer for a past due debt. There are certain procedures that the creditor is required to follow, and when the creditor fails to play by the rules you can and should take action against them. Possible results from a lawsuit against a debt collector include monetary damages for the amount you are out of pocket for having to bring the action as well as possible punitive damages. Punitive damages are designed to “punish” the offender, and prevent repeat of the offensive behavior in the future.

The Fair Debt Collection Practices Act governs the way in which a debt collector is allowed to collect debts. The Act also provides for remedies to consumers who have been the subject of an abusive or harassing collection practice. Remedies include:

● Actual damages incurred.

● Payment of attorney fees for having to sue the collector.

● A mandatory $1,000.00 fine per violation of the Act.

You can sue a debt collector in state court, in federal court, or within a bankruptcy proceeding. Where you bring suit will depend on the specific facts of your case, and a trained attorney will know which option fits your case. We have experience bringing actions against debt collectors and place an emphasis on this type of case within our legal practice. For help, call one of our trained legal professionals.

If you are being harassed or threatened from a debt collector, call our office for help. We will fight for a full and fair compensation for your damages while holding the creditor’s fee to the fire for accountability. Call a Plantation, Florida debt relief attorney today for more information.

Phantom Debt or Zombie Debt

These names may be foreign to some, but the companies that operate within their confines are not. If you (or someone you know) have ever been subjected to debt collectors, then you probably are well aware of who phantom or zombie debt collectors are. According to a report issued by CNN in July 29, 2014 one in three Americans are now dealing with debt collectors.

Types of Debt Collectors

Debt collection practices fall into three major categories – house accounts, collection agencies or debt purchasers. With house accounts, employees of the company (their representatives) are tasked with collecting past due debt. Their goal is to resolve and collect outstanding balances before a debt becomes too old (typically six-months) and is written-off as uncollectible. Once the debt is written-off, it is usually sent to an outside collection company that is tasked with collecting the outstanding balance. In most cases (but not all), the collection agency gets a percentage of any monies they collect, some get upwards of 50% of all the money they collect. The last category of debt collectors are debt purchasers. These collection companies buy old debt that is no longer being worked by the original creditor or an external collection company. In most cases, the debt has aged substantially (often three or more years since the debtor defaulted).

How the Phantom/Zombie Debt Works

The reason it is called phantom or zombie debt is that these old debts tend to arise from the dead or are not owed or belongs to someone else – like someone with the same name or a deceased child or parent. After years of not hearing about an old debt, suddenly and out of nowhere, a letter or phone call comes from ABC, XYZ, (or whatever) Asset Management Fund (Company, LLC, etc.). The letter will state that they are attempting to collect on the debt owed to “such and such” company. They will lead you to believe that they are a debt collector working for the original creditor. However, this is not true.

The truth is they have purchased the debt from the original creditor or a collection agency (one that has given up on collecting the debt) for mere pennies on the dollar. They might have purchased your old debt that was originally $1,000 for as little as .50 cents. In the extreme, they may have spent several dollars for the debt. The asset purchase companies relish buying this debt for two reasons – it is a fraction of the original cost and with cumulative interest added it is now worth many times more than the original amount you owed the creditor.

Why the Misrepresentation?

Most (if not all) of these asset purchase buyers want you to think that they are representing the original creditor and that they are going to make you an exceptional, but limited time offer. They try to convince you that you can finally settle this debt and put it behind you. They hope that you, the debtor, is ignorant of zombie debt collectors and will easily fold to their demands and antics.

If they were honest and forthright and explained that they purchased the debt for pennies on the dollar, they would lose their ability to extort monies from you using deception. The asset purchase model is so lucrative that if only a small percentage of accounts paid up, the profits become staggering. One of the leaders in “debt asset purchasing” claims the retail value of their portfolio is over a billion dollars – are you starting to see the picture.

Consumer Rights and Protection

As with all debt collection, there are laws, regulations, and practices, which govern and provide protection for debtors. Unfortunately, overzealous collectors sometimes (all too frequently) go beyond what the law allows in attempting to collect a debt. In some cases, a collector may have violated federal law and could be subject to fines/penalties or both. It is important for a consumer to understand their rights and to seek the help of legal counsel when these rights are violated.

The next blog will detail the rights of consumers, and the standards that creditors and collection agencies are expected to adhere as defined in the Fair Debt Collection Practices Act.

If you are having problems with debt or debt collectors, Dzousa Legal is here to help you. We will gladly meet with you to discuss your options. The initial review of your matters is without obligation or fees.