Debt Settlement and Colleciton Agencies

debt settlement and colection agenciesIf you have an old credit account that has been placed with a collection agency, you may be able to settle that debt for less than the balance.

How to settle debt with collection agencies

#1 If you are not sure you owe the debt, you have the right to request a DEBT VALIDATION from the debt collector.

According to the Fair Debt Collection Practices Act (FDCPA), every consumer has the right to make the company trying to collect a debt PROVE that you actually owe it.

You must write a letter and it should be something like this:

To whom it may concern:

Although I received a letter dated (date on the letter) from you demanding payment of the above debt, I do not think that I owe it and request that you VALIDATE THE DEBT according to the FDCPA, 15 USC 169g Sec. 809 (b).

Please provide the following:


  • Produce copies or the original contract that you say I signed, showing the date and my signature.
  • Provide a calculation that explains how you have arrived at the balance you say I owe.
  • Provide proof that your agency is registered in my state or why you have an exclusion.

If you can provide the above documentation, I will need at least 30 days to determine if this information is correct and again, according to the FDCPA, all collection activity must cease.

Looking forward to clearing this matter,

Your signature

Print your name

Date

Send the letter by CERTIFIED MAIL to prove that the collection company received it.

#2 If the debt collector does provide proof that you owe the debt, you should negotiate a settlement for less than the amount owed.

This can be tricky as these collectors are professionally trained to do whatever it takes to get you to pay as much as possible!

#3 If you get a settlement offer, make sure you GET IT IN WRITING!

Regardless of what the debt collector says, they can and MUST provide you with a letter, fax or email of the terms you agreed. DO NOT, I REPEAT, DO NOT authorize any type of payment without the settlement agreement in writing.

Once the payment has cleared, you should get a letter from the collection agency stating that the account has been "settled as agreed".

Your proof of payment (canceled check, bank statement showing a check-by-phone transaction for the amount agreed) along with the SETTLEMENT AGREEMENT, will be enough to prove that you have paid this debt as agreed if it ever surfaces in the future.

If this seems overwhelming or if you have questions, we can help.  Simply give us a call or click on the link below for a FREE debt elimination summary.

Tags: debt settlement, debt collectors, debt validation

Debt Management vs. Debt Settlement: Weighing the Options

debt management vs debt settlementDEBT MANAGEMENT vs. DEBT SETTLEMENT - What's the Difference?

It's important to know that one program does not solve all problems.

If you are making the minimum monthly credit card payments, Debt Management program may be right for you.

Debt Management (also known as Credit Counseling) allows you to consolidate all of your unsecured debt into one low monthly payment and offers the following benefits:

  • Pay less. Creditors will offer a plan to repay your debt at a reduced interest rate and in some cases, a lower payment.  Also, most creditors will wave late and over the limit fees AND bring your accounts back to current without making up those missed payments. This alone could save you thousands over the life of the debt!
  • Pay off your debt faster. If you continue to just make the minimum payments, it could take you 20-25 years to pay off that credit card! In a Debt Management Program, you should be able to pay off your debt in three to five years, saving you thousands of dollars!
  • Reduce your stress. Calls from you creditors STOP and you will have an end in sight.
  • One, easy payment each month. You will have one monthly payment so you don’t have to juggle payments.

But, if you cannot afford the payment required by a Debt Management Program, Debt Settlement may be the answer.

Debt Settlement is a program designed for people:

  • Who are delinquent or are starting to become delinquent on their payments
  • Some or all of their debts have gone into collections or are about to be turned over to a debt collector.
  • DO NOT want to file for bankruptcy

In a Debt Settlement Program, most people:

  • Have a substantial reduction in their monthly payment
  • Save thousands of dollars in both principal and interest
  • Are DEBT FREE in 36-48 months
  • and, AVOID BANKRUPTCY

DEBT SETTLEMENT CAN HELP WITH THE FOLLOWING:

  • Credit Cards
  • Lines of Credit
  • Medical Bills
  • Unsecured Loans
  • Collections
  • Repossessions

If you would like to learn more or if you have questions about these two options, our Debt Solutions Specialists are here to help.  Please give us a call at 1-877-492-4109 or simply click on the link below for a FREE COMPARISON of both programs based on your total debt!

Tags: debt collectors, debt settlement in oregon, debt management, debt management vs debt settlement

Stop a Wage Garnishment in Oregon

stop wage garnishmentIf you have received wage garnishment due to a judgment issued on your unpaid credit cards or other personal loans, it may be possible to stop it.

But, you need to know your rights.

Certain types of income are exempt from wage garnishment:

  • Social Securtiy
  • SSS or Supplemental Security Income
  • Veteran's benefits
  • Civil Service and Federal Retirment and Disability Benefits
  • Military Annuities and Survivor's benefits
  • Merchant Seamen Wages
  • Longshoremen's and Harbor Worker's Death and Disablity benefits
  • Compensation for Injury, Death, or Detention of Employees of U.S. Contactors outside the U.S.
  • FEMA (Federal Emergency Management Agency) benefits

Also exempt from wage garnishment:

  • Retirement income (pension and personal retirement plans)
  • Public Employee Retirement System (PERS) benefits
  • Income you may be receiving from a Reverse Mortgage
  • W-2 Income that is less than $936 net after tax per month( your state's exempt amount )

But, you also need to be aware that these incomes MAY NOT BE PROTECTED from:

  • Delinquent Federal and/or State taxes
  • Federal Student Loans
  • Child Support
  • Alimony

If you receive a notice of garnishment, you should immediately contact the attorney representing the plantiff (creditor).

Your employer cannot do anything for you.  In fact, your employer must fulfill the writ of garnishment or could be subject to a hefty fine!

In most cases, the attorney for the plaintiff will agree to a reasonable repayment plan instead of enforcing the garnishment.

But I said REASONABLE!

If the garnisment is going to be 25% of your net income (most states), and that comes to $500 per month, they are not going to agree to a $100 a month!

But, they may be open to say, $250-$350 for a STIPULATED AGREEMENT (SA).

You may also be able to settle the amount you owe for less than the full balance.  If you have any funds available, make an offer of approximately 50% fo the balance.

Since the judgment has been entered, and the writ of garnishment has been presented to your employer, the creditor will not be as willing to discount the balance as in a normal DEBT SETTLEMENT AGREEMENT.

If this sounds like too much for you to deal with us, please contact us.

stop a wage garnishment

Tags: wage garnishment, debt settlement, debt collectors, wage garnishment in oregon

Can You Negotiate a Second Mortgage After a Short Sale?

negotiate second mortgage after short saleIf you are wondering if you can negotiate a second mortgage after a short sale, I've got good news for you...YES YOU CAN!


If your property had a first and second mortgage and you chose to do a short sale rather than allow a foreclosure (usually the best choice in my opinion), then here's what happens:

The real estate agent or broker usually negotiates an amount in a short sale to satisfy both the first and second mortgage holder.

In most cases, the second mortgage holder receives a lot less than the first mortgage holder.

 

Depending on the agreement, language, etc. of the documents, whatever the 2nd mortgage holder receives is all they get.

However, in some cases, when the 2nd mortgage is very large, the 2nd mortgage holder may have the right to make a claim for the remaining (called deficiency balance) due.

The 2nd has now become an unsecured debt, just like any other unsecured debt and can be negotiated.

The creditor will follow the same procedures and any other debt collectors...calls, letters, unlawful threats (violating FDCPA) in an attempt to collect on the remaining balance.

What should you do?

1) Make sure the sale documents give the collector the right to pursue the remaining balance.

When you signed the short sale documents, there was something in there that spelled out how the proceeds were to be distributed to the creditors (1st and 2nd mortgages).

If you are not sure, check back with the real estate agent or broker (they were paid for this!!!)

If it is determined that whatever the 2nd mortgage holder did not agree to a "full settlement for less than was due" (or something to that effect), then you may be liable for the balance.

2) If the collector is calling several times a day, send them letter demanding them to stop immediately!

You don't have to put up with harassment from any collector!

The Federal Trade Commission has very specific rules for what a collector can and cannot do.

3)  Try to negotiate an amount that is much lower than they claim. 

In these types of negotiations, it may be possible to get a reduction of 25%-50%, depending on your specific circumstances.

This might be the time to seek professional help, and we can help!

negotiate second mortgage after short sale


Tags: debt settlement, debt collectors, fair debt collection practices, short sale or foreclosure

Debt Collector Harassment: Can anything be done to stop them?

debt collector harrassment callsCan anything be done about debt collector harassment?

 

YES!

A consumer is protected from debt collector harassment by the Fair Debt Collection Practices Act (FDCPA).  Here are some FAQs about Debt Collector Harassment:

CAN A DEBT COLLECTOR CALL AT ALL TIMES OF THE DAY?

NO, they are prohibited from calling before 8am or after 9pm (your time zone).  They may not call you at work if they are told that you are not allowed to get calls.

CAN A DEBT COLLECTOR CONTACT FRIEND, NEIGHBORS OR FAMILY ABOUT MY DEBT?

Yes and No... A debt collector may contact a third party, but only to inquire how to get in touch with you.  They ARE NOT permitted to disclose any information about your debt.

WHAT SPECIFIC PRACTICES ARE PROHIBITED BY THE FDCPA?

A debt collector may not:

  • make threats of violence
  • use obscene language
  • call many, many times a day

A debt collector may not make false statements such as:

  • claiming to be attorneys
  • claiming to be a government official or representative
  • claim that by failing to pay the debt you have committed a crime
  • claim that you could be arrested unless you pay

A debt collector cannot make threats such as:

  • you will go to jail if you don't pay
  • they are going to seize your property or garnish your wages unless they intend to take action or follow through with legal action

 

These are just a few of the actions and practices that are forbidden to debt collectors.  Unfortunately, debt collectors habitually violate the FDCPA!

WHAT CAN YOU DO WHEN A COLLECTOR BREAKS THE RULES?

If you think your rights have been violated, contact your state's attorney general's office and file a complaint.

For example, in Oregon, CLICK HERE.

Bottom line...you have rights as a consumer and do not have to put up with debt collector harassment!  If you would like help, our Debt Solutions Specialists can answer your questions.

debt collector harassment

photo by: chmeredith




 


Tags: fdcpa, debt collectors, debt collector harassment

Debt Settlement in Oregon

debt settlement in oregonCan I use debt settlement in Oregon to clear up old debts?

YES! Debt Settlement is a viable option that creditors will consider when you are facing difficult financial times.

HOW DOES DEBT SETTLEMENT WORK?

After you have been delinquent in paying your accounts, usually those accounts go into an INTERNAL RECOVERY department within the company.  During the first couple of months, you will receive numerous calls and letters about your account.  These calls can be VERY ANNOYING, and in some cases, put your job in jeopardy if they call you at work!

THE GOOD NEWS is that you can PUT A STOP TO CREDITOR CALLS.

According to the FAIR DEBT COLLECTION PRACTICES ACT (FDCPA), once you have requested/demanded that the creditor stop calling you, they must stop!  If they continue, you can report them to the State Attorney General's office and they may be subject to a hefty fine!

After approximately 120-180 days, if the creditor has not bee successful in getting you to start paying again they may offer your a Hardship Plan. Before you agree to their offer of a "HARDSHIP PLAN", you need to read  BEWARE OF SO-CALLED HARDSHIP PLANS!

If you choose to decline the Hardship Plan, your account wil be CHARGED OFF, it will be placed with a COLLECTION AGENCY.  This agency may also be a law firm that only specializes in debt collection.

At this point, the calls and letters start again! Even though you requested that the original creditor stop calling, now your account has been placed or sold to a different company and you must send the demand-to-stop calling letter again!

Your account has now been delinquent for approximately 6 months, and depending on your circumstances, a settlement offer of 50% or less may be possible.  It takes a lot of time and effort to secure a good settlement, but settlements can and are negotiated all the time.

Click here for some ACTUAL SETTELMENT EXAMPLES.

If you are able to negotiate a good settlement (50% or less), before you send money or agree to a check-by-phone, GET THE SETTLEMENT AGREEMENT IN WRITING!

Many consumers have made a verbal agreement over the phone, authorized a settlement payment, and then find out that the company claims that the payment was just toward the ENTIRE BALANCE, and not a settlement-as-agreed.

Yes, DEBT SETTLEMENT IN OREGON as well as most all states is possible, but time consuming.  We have been helping people become DEBT FREE through DEBT SETTLEMENT FOR MANY YEARS  and may be able to help you also.


Tags: fair debt collection practices act, debt collectors, hardship plans, stop the collection calls, debt settlement in oregon

How Long is the Statute of Limitation on Credit Card Debt?

statute of limitationsIf you have old credit card debt, you may be wondering how long a collector has to collect.

There was an interesting article in our local newspaper "The Oregonian" today, 4.2.12 entitled "More time for debt collectors".

Seems that three people sued the credit card/debt collectors (specifically Daniel N. Gordon, an attorney in Eugene that specializes in debt collection) that the creditors could not sue after 3 years because the statute of limitations was only 3 years in the state of Delaware (the state where the credit card company lists as the home office).

The Oregon Court of Appeals ruled that a creditor can have as long as the individual's state's statutes of limitation to attempt to collect a debt.

In Oregon and Washington, the statute of limitations is 6 years.

What does that mean to you?

If you have old credit card accounts that you have not paid on for over 6 years you have a couple of rights that you need to know:

If you see that debt (longer than 6 years) on your credit report, you can request that it be removed as the statutes of limitations has expired.

The credit reporting agency (usually Experian, Equifax or TransUnion) will investigate and if you are correct, remove the item.

In some listings on a credit report, you will see a notation of when this account is scheduled to be removed due to the statute of limitations being exceeded.

It is important for you to know what the statute of limitations is for your state.  You can find a listing (although you should double check on line at your State's official site) at:

                              LISTING OF STATE'S STATUTES OF LIMITATIONS

 

Another reason it is important for you to know your rights is if a collector sues by filing a claim in the county court of your residency, you can dispute the claim if the statute of limiations has expired (for your state of residency).

WARNING!

You need to be aware of the term "re-aging" debt.  If a collector calls and you agree to make a small payment to stop further action, etc., the statute of limitations clock is reset and basically starts over!

Therefore, if you have old debt, is is NOT WISE to talk with a collector or to make any acknowledgment of the debt.

According to the Fair Debt Collection Practice Act (FDCPA), if you make a request in writing to the collector, they must stop calling you at home or at work.

In making the request, DO NOT ACKNOWLEDGE THE DEBT!

State that you dispute the validity of the debt and that you are not responsible.

Demand that they cease from calling you at work and home or that you will report them to your state's Attorney General's office.

If you would like help, here's a link that will show you HOW TO STOP COLLECTION CALLS.

If you want to resolve an old debt rather than risk legal action from collectors, you should consider a Debt Settlement Program, where you may be able to settle the debt at 50% or less and have it removed from your credit report!

For more information, click the link below for a FREE CONSULTATION!

 

Tags: fdcpa, debt settlement, debt collectors, fair debt collection practices, how long is the statute of limiations on credit ca

Can A Debt Collector Call Me at Work?

Can a debt collector call me at work?

Creditors are notorious for violating the Fair Debt Collection Practices Act (FDCPA).  This LAW is supposed to protect consumers from unscrupulous and ILLEGAL debt collection activity!  However, most consumers are unaware of their RIGHTS UNDER THE LAW and are intimidated.

The Federal Trade Commission (FTC) has very good information that every consumers should understand.  Click her for a FREE GUIDE FOR CONSUMERS.

can a debt collector call me at workA debt collector is PROHIBITED from calling you at work IF they have been told (orally or in writing) that you are not allowed to receive calls at work.  If you are getting calls at work, here's what you need to do to STOP THE CALLS.

  1. Write a letter demanding them to stop contacting you at home or at work.
  2. Send the letter by registered mail so that you have proof that the collector received it. (pay for a "return receipt")
  3. Make a copy of your letter. 

Once the collector receives your letter, they may not contact you again, with two exceptions:

  • A collector can contact you to tell you there will be no further contact or
  • A collector can contact you to let you know that they or the creditor intend to take a specific action, like filing a lawsuit.

If they continue to call, you can report their ILLEGAL ACTIVITY to your state's Attorey Generals office.

Did you know? A debt collector in prohibited from:

  • Calling before 8am or after 9pm at night.
  • Using harassment such as making threats, using obscene language or repeatedly calling many times a day.
  • Making false claims such as claiming to be an attorney or government representative.
  • Misrepresenting the amount you owe.
  • Making false statements.  (They cannot say that you will "go to jail" or "be arrested" or even claim to take legal action if in fact, they do not do so.)

If you have been receiving collections calls and would like help with stopping the calls and eliminating the debt once and for all, our Solutions Specialist are here to help.  Give us a call at 877-492-4109 or click on the link below!




Tags: fair debt collection practices act, debt collectors, how to stop collection calls, can a debt collector call me at work

Can a Creditor Take Funds From a Reverse Mortgage?

reverse mortgageIf you have a REVERSE MORTGAGE on your home, a creditor cannot garnish, levy or lien.

If you are one of the millions of people who have decided to get a Reverse Mortgage (RM) on your home to help your financial situation, and have other significant debt, you need to understand what a creditor can and cannot do.

I'm not going to discuss the pros and cons of a reverse mortgage, but only address the characteristics and how it would apply in a collection situation.

A reverse mortgage is a LOAN.  The company that sold you the reverse mortgage (RM) took into consideration how much net equity you had in your home.

Let's say it was $100,000 (doesn't matter if the home was paid for or not).

The RM company is LOANING you 70%-80% on the value of your home to be paid out:

  • One-time lump sum
  • Payments
  • Credit Line (you use when you need to)

The RM company has determined that based on the net value of your home, your age and other factors, they  can LOAN you $XXX.00.

When you pass away or the home ownership is transferred, the LOAN, with interest, must be repaid. The idea is that at death or transfer of ownership, the RM and repayment cancel each out.

  • The home owner wins and they were able to get at the equity of their home and remain living there.
  • The RM company wins as they earn more money than they loaned through interest and fees.

So, can a creditor or collector GARNISH, PLACE A LIEN OR LEVY funds from your RM?

                 THE ANSWER TO ALL THESE QUESTIONS IS NO!   (BUT BE CAREFUL)

Since a RM is a loan, you do not own the home anymore.  You live there and everything stays the same, but you have "pre-sold" it to the RM Company.

Therefore, a creditor CANNOT garnish or place a lien.

What about the funds from the RM deposited in your bank account?

This is why I said "BE CAREFUL!"

A creditor that has been awarded a judgment for the claim they made against the debt you owe (credit card, personal loan, etc.) cannot apply for a garnishment or bank levy if the source to the funds are from:

  • Federal Benefits (Social Security, Federal Retirement Income, Civil Service Retirement)
  • Unemployment Income
  • Dissability Income
  • Alimony or Child Support
  • Various other NON-EARNED INCOME sources including your RM income

HOWEVER....

If you CO-MINGLE funds from your RM or other sources above with the income you may be getting from a full or part-time job (W2 Income), then a creditor may be able to get at those funds.

The safest thing to do is to open up a separate bank account for the earned income and NEVER CO-MINGLE with the other sources of income.

reverse mortgage

 

 

Tags: reverse mortgage, debt collectors, levy, garnishment

Don't make these MISTAKES dealing with collectors!

STOP! Don't make these mistakes dealing with collectors!  

Dealing with debt collectors rarely is a pleasant activity. They call you up at all hours of the night, send you nasty letters and make your life a living nightmare. Bad as it may seem, you can only make it worse by making one or more of these mistakes:

mistakes dealing with collectors

 

1. Lying: If you lie and you're caught in the lie, you can be sued.

2. Paying without receiving a confirmation letter: If you pay the debt, make sure you get confirmation that the account is closed. Also, check your credit report two months later to see that the line on your credit report shows "closed" or "settled" or "paid as agreed."

3. Failing to dispute a charge in a timely matter: If you believe you have been wronged, you must file the proper claim as soon as possible. The statute of limitations is very specific depending on your state; if you wait too long, you could lose your legal right to dispute the claim.

4. Ignoring the situation: If the collection agency has a legitimate claim against you, especially if it knows you have a job, things can only get worse, not better. Talk to an experienced Solutions Specialist to start investigating your options.

5. Bouncing checks: This will get your case sent immediately to the creditor's legal department.

6. Becoming intimidated: In the words of Eleanor Roosevelt, "No one can make you feel inferior without your consent." Don't let the collection person bully you around. The FDCPA states very clearly what a debt collector can and cannot do.

7. Letting the creditor or collector deduct money directly from your bank account: Never give the creditor your checking account number.

8. Making promises you cannot keep: Sometimes you will be tempted to just say, "The check is in the mail." But when the check doesn't arrive, they'll call even more frequently. They may even try to sue you for lying.

9. Avoiding the calls: They will only occur more frequently. You can stop the calls by taking a few simple steps.  

 mistakes dealing with collectors

 

photo by: Qfamily

Tags: debt collectors, common collection practices, mistakes dealing with collectors