Dealing With Debt Collectors....No FEAR!

When a debt collector calls, it can be not only annoying, but also a little scary!  But dealing with debt collectors does not have to be something you fear.  Let me show you what to do...

 

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No matter how serious you financial and/or debt situation is, there is  a solution.  DON'T BE AFRAID!

  • Debt collectors are people just trying to earn a living.  

I've been dealing with them for many, many years and most of them are not hard to deal with. If, you know a few things about them.

Usually, the debt they are calling about is one that you owe.

 

Of course, if you can prove that you don't, you can always demand that they "validate" the debt by providing documentation.

The Fair Debt Collection Practices Act (FDCPA) gives us protection from illegal debt collection practices.

Basically, it spells out what a debt collector can and cannot do in attempting to collect debt.  It allows a consumer to question the validity of the debt they are calling about. 

There are also many "credit repair" companies that advocate using the validation process to remove debts from our credit report.

While you should challenge or dispute errors on our credit report, beware of opening a validation dispute on accounts you owe as it might backfire on you!

Unless you can prove beyond a doubt that you never had or have paid the debt with proof in writing, don't send the letter!  Why?

A debt collection company has been retained by the original creditor or the owner of the debt.  Yes, creditors buy and sell debt.  In fact, it is a multi-million dollar business.

Anyway, while a request to validate the debt may work, it could cause the debt collector to become very aggressive in their collection efforts! 

This may include filing a CLAIM, resulting in a SUMMONS, that may lead to a JUDGMENT, which could lead to WAGE GARNISHMENT, LIENS and BANK LEVIES!

 

So, before you "jump into" debt validation...You need to contact the collector, but before you do, get prepared:

1)  First, you'll need a BUDGET:

 Budget Worksheet FREE Download here!This will not only let you know how much (if any) money you can offer to SETTLE the debt and the debt collector will most likely ask about your situation.

2)  Call the collector:

Be calm and respectful! 

Trying to act "tough" or being disrespectful will NOT HELP!

While you'll need to explain your situation, don't "over do it".  The collector may need to submit your settlement offer with some budget information to the owner of the debt or they may be able to discuss and negotiate a settlement right now.

Always ask them what it would take to settle the debt! 

They may come back with, "How much do you have to offer?"  

Say something like, "I don't know, I am barely making it now.  What will it take?"

In negotiations, the person who gives out an amount of money usually loses!

Let's say you owe $5,000  and they say they can settle for $4,000. While that is a nice $1,000 reduction, you should be able to do a little better.  Say something like...

"I just don't have $4,000, but I may be able to could come up with $2,000 if you could give me a little time."  That's it...stop talking...wait for a response.

They may or may not accept, or they might come back with a counter offer.

You're trying to get somewhere around 50%.  Here's a few examples:

Recent Settlements See what we have  done for our clients!

Negotiating a settlement is not easy! (I know!  I've been doing this for about 17 years now!)

If you are successful in negotiation a good settlement, you MUST GET THE AGREEMENT IN WRITING!!!!!!!!!

Let me state that again....NO AGREEMENT IN WRITING....NO DEAL!

If you are unsuccessful, then just tell them that you'll have to get back to them and politely hand up.  They may or may not follow up with you.

FINALLY, the worst thing you can do is to ignore the debt.

If you do, while the account may be pulled back to the owner of the debt and transferred to another collector, it cause the collector to become too aggressive and possibly initiate legal action by the collector!

By dealing respectfully and confidently with the debt and the collector, you may be able to settle the debt or if necessary, just set up payments to repay the entire debt.

Hope this helps!

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Tags: illegal debt collection pracitces, mistakes dealing with collectors, garnishment, Oregon debt collection

Wage Garnishment in Oregon...Know Your Rights!

If you receive a notice that your wages are going to be garnished, you need to act, and act fast! Here's some helpful tips you can use:

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Here at Debt Relief NW, it seems like we get dozens of calls weekly from people who "just found out", that their pay check was going to garnished!

I've highlighted the phrase, "just found out" to make a point:

A WAGE GARNISHMENT DOESN'T JUST HAPPEN!

There is a legal process that must unfold before a creditor or debt collector can receive a writ of garnishment from he court to send to your employer.

I am going to outline, in a nutshell, so to speak, of the process and what you:

  • COULD HAVE DONE TO PREVENT IT and,
  • WHAT YOU CAN DO NOW TO STOP IT

For the purpose of this article, I'm only referring to UNSECURED DEBTS, such as:

  • Credit or Store Cards
  • Personal loans (NOT mortgage or auto loans)
  • Deficiency judgment after a repossession
  • Medical bills
  • Private student loans

OK, let me lay out an example (based on over 15 years of helping people with their debt issues):

I'll call him Joe.  Joe has a decent job and earns about $20/hour.  At 40 hours a week and an average of 4.2 weeks/month, his GROSS (before taxes and deductions) is $3360/month.

Of course, after taxes and other deductions, his NET INCOME ("TAKE HOME")  is only about $2352 (approximately 30% less than his Gross Income).

He is renting an apartment and has all of the usual bills.

His total budget or outgo is about $2100 a month, leaving him barely $250 for emergencies, etc.

Included in that budget is about $15,000 of credit card debt spread over 3 cards:

  • Visa                 $8,000
  • Master Card    $6,000
  • Home Depot    $1,000

The total monthly MINIMUM PAYMENTS on all add up to $300/month.

Joe is having a very difficult time making the $300/month, minimum payments and then, he is working around the house and falls off a ladder and breaks his leg!

His insurance policy doesn't provide for any "disability income" for the accident, so not only is he going to be off work for about 3-4 months, he doesn't have any means of income.

Fortunately, he had a little savings account, but it wasn't enough to cover all of his monthly budget.

So, Joe does what thousands of people do every day, he pays all of the most important bills, like his rent, utilities, groceries, etc. and let's the credit card bills get behind.

NOW WHAT?

After he misses a payment or two, he starts to get letters and calls, lots of calls!

At this point, Joe can't do anything about the annoying calls, because as long as his account is still with the original creditor, they have the right to call him about it.

But, once the account is charged off, sold, or transferred to a collection agency or other third party, then he can put a stop to the calls!.  (I'll show you how in just a minute.)

Of course, Joe tries to explain to the caller what he is going through and they may or may not offer some kind of "HARDSHIP PROGRAM"  to help him through this.  But, it really doesn't matter as he just will not be able to make any payments until he is back to work and get some other bills caught up.

NEXT...

The original creditor(s) will most likely charge off, sell or transfer the account to a collector after about 120 days of so if nothing can be arranged.

So now, Joe starts getting letters and calls (LOTS OF CALLS)  debt collectors!

He'd like to make some kind of arrangement with them, but they are demanding full payment on the balance or else!

At this point, he can put a stop to these calls.  Here's how:

STOP Collection Calls Free Sample Letter

But, even though the calls are stopped and he is just "ignoring" the letters, the debt is not going to go away.

THE DEBT COLLECTOR DECIDES TO FILE A CLAIM

If the debt collector is unsuccessful in getting you to start making payments, then the debt collector may decide to start the legal process of obtaining a judgment.

An attorney for the collector will FILE A CLAIM at the courthouse of the county where you reside.

This CLAIM will generate a SUMMONS that will be delivered to you, usually in person, but sometimes by registered mail.

I'm not going to go into all of the details of what to do with the SUMMONS here, but you can check out a blog I've written that will be very helpful called:

 

WHAT TO DO IF YOU RECEIVE A SUMMONS.

 

But, please DO NOT IGNORE THE SUMMONS!

The fact that the collector decided to file a CLAIM proves that they are very serious about collecting on this debt.

If you ignore the summons, then a court date will be scheduled (you don't have to go), but a representative from the collector (now called the PLAINTIFF) will show up and the court will award them a DEFAULT JUDGMENT.

It's called a "default" judgment because no one contested it and they won by default.

NOW WHAT HAPPENS?

Now, the PLAINTIFF ( the collector) can apply for a WRIT OF GARNISHMENT.

The Writ of Garnishment is sent to your employer and they, by law, must obey the writ and withhold up to 25% of your net, after-tax, income.

Joe has just gone back to work and then he get's this notice from the payroll department that he is being garnished...and he starts to panic, which is understandable!

Remember when we did the math earlier about what his actual "take-home" or "after tax" income was?

That amount was $ 2,352.

Most states allow for up to 25% of the net, after-tax check to be deducted and sent to the creditor until the full balance (inflated now with interest and legal fees) is repaid!

WOW...WAIT A MINUTE...

$2,352 X 25% = $588 will be deducted from Joe's Net Check!

He could barely make it on the $2352, and now he has to somehow make it on $1764!

Yep....PANIC!

 

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OK, so Joe's really in trouble, you get it...

How did this happen and what can he do about it now?

Joe could have stopped this "process" and ultimate JUDGMENT by trying to work out a SETTLEMENT PLAN with the debt collector.

Most debt collectors would much rather accept less than the full balance than go to all of the time and expense to seek a judgment:

Recent Settlements See what we have  done for our clients!

When Joe received the summons, he could have contacted the attorney for the collector and most likely worked out some kind of repayment arrangement that may have included a reduced settlement!

Once the judgment was awarded and the plaintiff had spent more money in legal fees, they went after the garnishment.

But that doesn't mean that you still could not work out something to stop the garnishment!

You may be able to get them to stop the garnishment and take a more "reasonable" amount to repay the debt.

Depending on the circumstances, you may even be able to not only stop the garnishment, but also get a reduced settlement.  Each case is a little different.

If this help, great.

If you find it a little "over-whelming", then maybe we can help:

FREE  Debt Elimination Summary

 

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Tags: debt collection, summons, how to prevent wage garnishment, credit card, garnishment

Beware of Debt Collection Scams!

Being in a financially stressful situation is bad enough, but then add to that a call or letter from a "so-called" debt collector that threatens fines and/or imprisonment can be happen!  Here's what you need to know and what you can do about it:

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Being in a situation where you just can not keep up with the payments due on your credit cards or other unsecured debts can be very stressful and fearful.

You have several options to help you get through this (which I'll talk about later), but it is very helpful if you have a basic understanding of how the debt collection process works...legally, that is!

Calls and letters

Once you start to fall behind in making at least the minimum payments required, you will start to get calls and/or letters.  The original creditor usually starts with a letter saying something like"

"Your account is seriously past due and you must call us immediately to arrange repayment or your account may be charged off and turned over to a debt collector or attorney."

What the original creditor really wants is help you start making some kind of payments again.  They really don't want to lose you as a customer or to have to charge off your account as a bad debt.

Most major credit cards or other lenders have in-house collection departments that will attempt to get you to pay.

JUST A WORD ABOUT STOPPING THE CALLS...

As long as your account is still with the original creditor, they have the right to call you in regards to that accounts.

Now, once that account is transferred or sold to a debt collector, then you can stop the calls.

I'll show you how is just a minute.

If you have the ability to get caught up and keep your account from being charged off and turned over to a debt collector, you should do so.

But, BEWARE of a so-called "Hardship Plan" offer!

Your creditor may offer you a 6 month, lower payment and/or interest to help you get "back on your feet".

These"Hardship Plans" are usually not in the consumer's best interest and you should really examine the offer before agreeing to it.

Account placed with a Debt Collector

After your account has been delinquent for about 3-4 months with no payments, most of the time, the creditor will transfer or sell your account to a debt collector.

Now, you start getting letters and calls from them, but now, you can at least put a stop to the calls.  Here's how:

STOP Collection Calls Free Sample Letter

Now that your account is with a debt collector, you may be able to negotiate a SETTLEMENT for less than the full balance due.

A successful settlement depends on several factors and although not that easy to do, can be done.  Here are some actual examples of a settlement:

Recent Settlements See what we have  done for our clients!

Most debt collectors will work with you and will follow the law as laid out in the Fair Debt Collection Practices Act or FDCPA.

A debt collector can and cannot do certain things in an attempt to collect a debt and it would be worth your time to familiarize yourself with your rights under the FDCPA.

Beware of Debt Collection Scams!!!!!

Once in a while you may get a call, letter or email from a debt collection scam company.

One of our clients received an email recently from just such a company.  It stated:

This letter is to notify you that we have received a Summons of Garnishment on your wages. This means that someone you owe money to has been awarded a judgment by the court for payment of the debt. The court has ordered us your employer to deduct 50% percent of your disposable earnings and make payment to the court on your behalf. The following applies to you:

Before you are arrested

If you pay in full, or make a part-payment before you are arrested, the warrant will be recalled and amended. However, it will be immediately re-issued if the debt is not paid in full.

After you are arrested

Once the warrant has been served, your only options are to serve the time in prison or pay the debt (plus costs) in full at the court house.

If you want to stop the garnishment deductions from your paycheck, you must obtain a release or pay the entire amount you owe, which you can pay with the help of Money Gram, Western Union, OneVanilla Prepaid Visa Card and American Express Prepaid Debit Card in order to close this account.

Sincerely,

Frank Dollard, Sr. Officer

UNITED STATES OF FEDERAL MANAGMENT      ACELOAN.ONLIN

Not only was this a scam, but also illegal under the FDCPA!

Here is an article concerning this you should visit:

American Cash Services USA - Payday Loan Collection Scam

There are so many violations of the FDCPA, I don't know where to begin.  But, let me point out a couple of the most blatant ones:

A debt collector cannot threaten that you will be arrested!

Yes, a debt collector may choose to FILE A CLAIM concerning your account.

You would receive a SUMMONS, and if a settlement could not be reached, a JUDGMENT may be awarded to the plaintiff (collector).

Then, and only then, could the plaintiff seek payment via wage garnishment or bank levy.  But, even these have restrictions and limitations.

I've written several blogs about WHAT TO DO IF YOU RECEIVE A SUMMONS, and it may help you to check out.

If you ever receive a call, letter or email from a company like this, DO NOT REPLY,  but contact your state's attorney general's office immediately.

If you live in Oregon, click here

So, do not be tricked into one of these collection scams!

When your debts are just too much to handle, you have several options, but do not fall prey to one of these crooked scams!

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Tags: debt collection harassment, debt settlement, receive a summons, abusive debt collection practices, garnishment

What to Expect While in a Debt Settlement Program

Before you make the decision to enroll in a debt settlement program, here are some very important things to consider:

The decision to enroll in a Debt Settlement Program should only be made after careful consideration and weighing all of you options.

22853064975_8c547f714f_m.jpgFirst, some VERY IMPORTANT POINTS...

Not everyone should enroll in a debt management program! 

Debt Settlement is not an "easy" way to get out of paying the debts you owe!

Not all Debt Settlement companies are alike or legitimate, so be very careful in deciding!

You cannot just forget about your debts and the program!

A Debt Settlement Program may take a few years to complete.  It is not a "quick fix"!

 

NOT EVERYONE SHOULD ENROLL IN A DEBT SETTLEMENT PROGRAM

I began helping people with debt problems almost 15 years ago, so I understand and appreciate it when someone calls seeking help.

Most of our clients (I'd say 95% or so) needed help after something very traumatic and/or financially devestating happened to them.

It could have been one or a combination of the following:

  • Unemployment, downsizing, or a significant reduction in  income
  • Death of a spouse of partner that cut income dramatically
  • Sickness or disability not only limiting income, but requiring payment for medications and treatment
  • Too little fixed income after retirement
  • Divorce

When a catastrophic event happens, it usually does not give us much, if any, warning. 

You have a mortgage, or rent, car payment, normal bills, a few credit card accounts that you are making all of your required payments on each month with maybe even a little left over.

Then, you lose a large portion of income and all of a sudden, there just isn't enough income to keep up with all of your obligations.

At first, you're concerned, but not too worried as you expect things to turn around in a short period of time.

But after a few months, the small savings you had (if any) is gone and you actually had to do a cash advance in order to meet your obligations.

Your credit cards begin to get maxed out and soon, you just simply cannot keep up.

What can you do?

You really only have a few choices:

In a Debt Management or Credit Counseling Program, usually your interest rates ared reduced, late or over-the-limit fees are stopped (and sometimes forgiven), you have one monthly payment to a company that distributes it to each of your creditors as per the agreement.

The calls and letters stop and usually, you debts are paid off in around 48 months.

THE PROBLEM IS....

The minimum total monthly payment is usually as much or MORE than you are currently unable to meet!

Now what?

If you cannot qualify for the Debt Management Program, then the Debt Settlement Program may be just what you need to avoid the 3rd, and in my opinion, the final option after all other options are examined, Bankruptcy.

Previously, I stated that a Debt Settlement Program IS NOT for everyone.

I believe that if you have taken out debt, then you should, if at all possible, repay the debt per the agreement.

Debt Settlement SHOULD NOT be a "get-out-of-debt-free" card!

By the way, a professional, qualified Debt Settlement Company will take the time to go over you particular situation and outline all of your options so that you can make an informed decision.

Be VERY SUSPECIOUS of any company that tries to "sign you up" very quickly without reviewing all of your options!

Once you are enrolled in a Debt Settlement Program, here is basically what will happen:

Most likely, you have missed or stopped payments to your creditors.  These creditors are going to send letters and will call you seeking payment.

While your account is still with the original creditor (it has not been charged off yet), that creditor has the legal right to call you concerning the debt.

However, they must comply with the Fair Debt Collection Practices Act that protects consumers from harassment int he debt collection process.

Once your accounts are 120-180 days late, they most likely will be "charged off" and assigned or sold to a Debt Collector.

A Debt Collection Company will take accounts on consignment or buy debt in order to get some kind of payment from the consumer.

Once that account has been placed with the Debt Collection Company, they will send letters and start to call, and call, and call!

The good news is that now, you can PUT A STOP TO THESE CALLS!

STOP Collection Calls Free Sample Letter

Just use the Free Sample Letter above, follow directions, and the call should stop very soon.  If not, your Debt Settlement Company will help put a stop to them!

The agent who enrolled you into the Debt Settlement Program has gone over your budget to determine an amount that works with your situation that you can contribute to your Settlement Fund each month.

It will be much less than the total monthly amount you were required to pay before!

While this fund is growing, a negotiator from the debt settlement company will contact the debt collector to start negotiating a settlement.

Depending on a number of factors, usually a settlement around 50% of the current balance will be negotiated.

After a written SETTLEMENT AGREEMENT is received, a the payment will be made.

In many cases, the final settlement agreement can be paid out in monthly payments (0% interest) from you settlement account over several months.

Again, it all depends on your particular situation.  Your negotiator will most likely discuss the situation with you.

Once the settlement is completed, the debt collector should contact all 3 major credit reporting bureaus that this account has a $0 balance and has been paid-as-agreed.

Over time, the process of settlement will IMPROVE YOUR CREDIT SCORE as your balances are going down.  But, it will not happen over night!

WHAT IF YOU CANNOT EVEN AFFORD A DEBT SETTLEMENT PROGRAM?

There are times that even after enrolling in a debt settlement program your financial situation worsens and you simply cannot afford to continue.

In that case, BANKRUPTCY may be not only your only options, but your BEST OPTION.

I believe that bankruptcy should be a person's "last resort"

In fact, the bankruptcy laws have changed over time to make it very difficult for someone just to walk away from their financial obligations through bankruptcy!

You should consult an attorney who specializes in Bankruptcy! 

The attorney will meet with you (no charge for the initial meeting) and go over you situation and your options.

FINALLY....

While a Debt Settlement Program is not for everyone, in many cases, it will allow you to:

  • Avoid Garnishments
  • Reduce you monthly outgo
  • Avoid bankruptcy

Need help making your decision? 

Let us help...

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Tags: debt settlement, debt collectors, debt, stop the collection calls, bankruptcy attorney, garnishment

Garnishment! Why it Happened and How to Stop!

If you've been slapped with a WAGE GARNISHMENT, you need to know WHY it happened and HOW to put a STOP to it!

A wage garnishment or bank levy/garnishment doesn't just "happen"!  

 

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Before a "writ of garnishment" can be granted to a creditor or debt collector, several things have happened:

When you sign up for a credit card, bank card, or any unsecured account (including medical bills), you have entered into a legal contract with the basic agreement that you will repay the loan at the terms and time frame outlined in the agreement.

If you don't, the original creditor has the right to:

  • Call you
  • Write you, or...
  • Hire a Debt Collector, or...
  • Retain an attorney to file a claim...bring a lawsuit!
  • Go to court to win a judgment against you
  • Apply for a Writ of Garnishment 

Let's walk through the process leading up to a WAGE GARNISHMENT, and I'll show you how to:

  1. Prevent a judgment
  2. Prevent a garnishment
  3. Stop a garnishment 

I've been helping people deal with credit and debt problems for many years and it still always is a mystery to me when someone calls for help and says,"I had no idea this was going on"!

Well, I suppose that is possible, but most likely, here is what happened:

1.  Something happened in your life that caused you to be unable to keep up with the required payments.  It could have been one or more of these:

  • Loss of employment
  • Divorce or other family problem
  • Death of a spouse or loved one
  • Long illness or disability
  • Barely enough income after retirement

When you are late or unable to pay the minimum payment due, you probably already know, but...

2.  Creditors start calling and writing, trying to find out what is going on.

Unfortunately, the original creditor has the right (remember that agreement with all the FINE PRINT?) to call or contact you by mail, so at this point, you cannot legally stop them.

3.  If the original creditor cannot contact you or you do not talk with them or return their request for a call, then they may place the account with a DEBT COLLECTOR.

The debt collector will start calling, and calling, and calling....very annoying!

But now you have the right to PUT A STOP TO THESE CALLS FROM DEBT COLLECTORS!

STOP Collection Calls Free Sample Letter

When your account has been placed with a debt collector, you may have the opportunity to SETTLE THE ACCOUNT BALANCE FOR LESS!

This is called DEBT SETTLEMENT and depending on your circumstances, this can be a very effective method for not only reducing the balance due, but also stop the potential legal process that may begin.

Although dealing with a debt collector can be a very intimidating and frustrating experience, if you feel up to it, you may want to call and see what they are willing to do for you,

If you are uncomfortable doing this, you can get help:

 

4.  If the debt collector cannot get you to set up payments to repay or are not willing to accept a REASONABLE SETTLEMENT, then they may decide to FILE A CLAIM.

Once the Claim is filed, a SUMMONS will be issued.  It usually is delivered in person, but may be sent by registered mail.

As I said earlier, although people will say that they never received a summons, in most cases...

  • They had received it, but just ignored it!
  • Someone in the household signed for it.
  • Someone in the household signed for it if delivered by registered mail.

But even if you really never received or saw the summons, at this point, it may too expensive to fight!  Yes, you could, but most likely you won't.

SO, NOW WHAT????

5.  The summons had stated that you had 20 -30 days to give an "ANSWER".

A legal ANSWER is you legal response to the claim/summons that you do not owe the debt and CAN PROVE IT!

Most people know that they owe the debt and so spending the money to give the ANSWER ( yes, it costs money to FILE AN ANSWER!!!)is a waste of time and money.

6.  Even if you do not file an ANSWER, you can still stop the process by negotiating a STIPULATED AGREEMENT.

Depending on your financial circumstances, the plaintiff (creditor) may agree to a repayment plan rather move forward for a garnishment.

The reasoning is that if you are slapped with a garnishment it may force you to seek bankruptcy protection.  If that happens, they may get little to nothing!

 

7.  But, if the previous procedures fail to prevent the garnishment or you receive noticed from you employer that you will be garnished, you still have options:

  • Call the attorney for the plaintiff and attempt to negotiate a repayment plan in lieu of the garnishment.
  • Seek bankruptcy protection.

Even if you receive the notice of garnishment from your employer, you still may be able to contact the attorney for the plaintiff/creditor and work out a repayment plan.

You will need to be able to show hardship and offer a reasonable payment plan.

But if the plaintiff/creditor refuses, then you may be forced to seek BANKRUPTCY PROTECTION.

Bankruptcy is a drastic option, but is not as bad as you think it is.  

Check with a bankruptcy attorney to get understand your options.

 

Now you know "WHY" the "HOW TO STOP" a garnishment.

But, taking action is still too much for most people.......

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Tags: Bankruptcy, debt, summons, stipulated agreement, debt settlement help, garnishment

Options to Stop a Wage Garnishment

If you get hit with a wage garnishment in Oregon, you are looking at having 25% of your take home pay garnished!  

Fortunately, you have options to stop the garnishment.

Recently, a young man called our office to see if we could help after he was informed by his HR department that he had been served with a writ of garnishment.

 

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Of course, he was embarrassed and shaken. His net (after tax) weekly take home check was about $800, so after the garnishment, he was going to lose $200/week!

If it was hard to pay your bills before, now he was going to have a little over $800 deducted from his pay each month!

No wonder he was scarred!

So, what are his options?

If you are being hit with a wage garnishment, it didn't happen by chance!

We get calls all of the time from people who say something like, "I don't know how this happened?  I never received anything!"

Before there can be a WRIT OF GARNISHMENT awarded, you had to have received a SUMMONS.

Check out those links above!  You cannot ignore a summons!

But, here you are, now...

Contact the attorney who filed for the writ of garnishment on behalf of the plaintiff/creditor/debt collector.

Many times, the original creditor or the debt collector who has the account now will be willing to accept a SETTLEMENT.  Click below to learn more:

FREE EBook Debt Settlement  Basics

But, what if you don't have funds to offer in a settlement?

Then you should be able to negotiate a STIPULATED AGREEMENT.

This is basically an agreement between you and the plaintiff that says you agree to make monthly payments and as long as you do, the attorney for the plaintiff will stop the writ of garnishment.

They (the attorney or the plaintiff) usually will work with you.

For example:

You certainly can't survive if they take 25% of you income, or in the above case, $800 a month, but you could afford $250/month (I know it won't be easy).  

They will set up the Stipulated Agreement that says that you are agreeing to make a payment of $250 a month until the full balance, plus attorney fee, plus court costs, plus interest (9% in Oregon, 12% in Washington, varies by state) is paid.

But, if you miss a payment, they will put the garnishment back on so, be very disciplined to make those payments!

What if you can't afford a reasonable (usually, they are not willing to take a small payment of $25 or so) payment?

Then you may be a candidate for BANKRUPTCY PROTECTION.

Bankruptcy is usually not a bad or terrifying as you think is is.  You should consult with a Bankruptcy Attorney (one that specializes in bankruptcy) to weight your options.

Still have questions?  We can help:

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Tags: garnishment

Garnishment From Debt Collectors?You May Be Exempt!

If you have received a Notice of Garnishment, DON'T PANIC!  You may be exempt, but you must do your homework and act FAST!

Although there are various types or reason for a garnishment, for the sake of this discussion, I'm talking about a garnishment as a result of not paying or being unable to pay the unsecured debts you may have, such as:

 

Now, just because you have fallen behind or even missed a few payments, the creditor CANNOT garnish until a judgment has been awarded.

 

But, before that happens, here is what usually happens:

 

1.  You start falling behind or have already fallen behind on the minimum payments due on your credit accounts.

2.  You will most likely start getting phone calls and/or "nasty" letters from the creditor.

3.  If the creditor does not receive any payments for approximately 3-4 months, they may decide to:

      A.  Charge the account off as a total loss.

      B.  Assign the account to a Debt Collector.

      C.  Sell the account to a Debt Collector/Debt Buyer

We have been helping people, like you, deal with all of the various issues that come from facing a financial circumstance that makes it very hard or impossible to keep up with your bills.

The most common mistake people make is to ignore the calls and/or letters.  I certainly understand how frustrating and depressing it is to get a call from an over-due bill or a debt collector and how the easiest thing to do is just not accept the call or respond to a letter.

WHY?

Although for the most part, creditors and debt collectors will act in a professional manner, sometimes they may go over line and break the law according to the Fair Debt Collection Practices Act.

It would certainly be worth you time to check out what a debt collector CAN AND CANNOT do when attempting to collect. 

The original creditor has the right to call you (as long as they comply with the FDCPA), so as long as the account is still with the original creditor, you cannot prevent them from calling.

However, you can stop them from calling you at your place of employment by telling them that youremployer will not allow any personal calls!

But, once that account leaves the original creditor, you can put a STOP TO THE CALLS!

 

STOP Collection Calls Free Sample Letter

Even though you may have put a stop to the calls, that doesn't mean that the debt collector will give up.  In fact, by not speaking with them, you may cause the original creditor to authorize the collector to FILE A CLAIM.

The many of the debt collection agencies are actually lawyers and if so, they will go to your county courthouse, pay the filing fee and file the claim.

A SUMMONS is issued.  This may be be certified mail, but most often, by someone in person.  VERY INTIMIDATING!

The CLAIM/SUMMONS is saying that you owe this debt unless you respond with an ANSWER, usually withing 20 - 30 days.  This "answer" is what you would do if you absolutely know (and have proof) that you do not owe this debt.

But, if you do, then there is no need for you to pay for and file an "ANSWER" with the court.

We help our clients AVOID A JUDGMENT by making sure they contact us as soon as they receive a SUMMONS.  Many times, in fact, most often, we can negotiate either a settlement or a STIPULATED AGREEMENT.

I'm not going to go into all the details here, but you should check out my blog:

"WHAT TO DO IF YOU RECEIVE A SUMMONS!"

If a settlement or stipulated agreement cannot be reached, the creditor or debt collector may decide to go ahead and seek a DEFAULT JUDGMENT.

Once the "default judgment" is awarded the creditor/plaintiff, then they may choose to seek a WRIT OF GARNISHMENT.

Now, the creditor or debt collector can go after your "property". 

But, YOU MAY BE ABLE TO PREVENT THE GARNISHMENT BY UNDERSTANDING WHAT IS AND WHAT IS NOT SUBJECT TO GARNISHMENT!

Each state has its own laws pertaining to garnishment, but basically they state that your wages can be garnished up to 25% of your net (after tax) take home wages.

And, they may be able to LEVY YOUR BANK ACCOUNT, unless you meet the EXEMPTIONS provided by law.

I'm not going to give every EXEMPTION here, but if you are subject to a garnishment, you most likely will receive a document that outlines these exemptions.

Some of the most common exemptions (in other words, they cannot garnish if...):

1.  You earn $218 or less per workweek.

2.  ALL of your Social Security Benefits are exempt!

3.  Retirement plans are exempt.

4.  Disability Benefits are exempt.

5.  And beside those, here are more:

  • SSI
  • Public assistance
  • Unemployment benefits
  • Workers' compensation benefits
  • Spousal support, child support and other income from a divorce are exempt
  • Your home's value!  Up to $40,000 for single and $50,000 of equity for jointly held property!
  • And there are many, many more...you must check out!

Bottom line:

Attempt to "head off" a garnishment by responding to the SUMMONS immediately.

Contact us if you need help....

 

 

 

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Tags: garnishment

How to Stop Abusive Debt Collection Practices

stop collector abuseYou do not have to put up with abusive debt collection practices.

Debt collectors must abide by the laws spelled out in the Fair Debt Collection Practices Act (FDCPA) or could face severe fines!

The  Federal Trade Commission (FTC)  is the nation's consumer protection agency and has published guidelines for consumers that explains what a debt collector can and cannot do.

Here are just some of the most abusive debt collection practices and violations:

Calling you many, many times a day at all hours of the day!

A debt collector may not call you before 8am (local time) or after 9pm (local time), unless you have agreed to it.

The best thing you can do to put a STOP TO DEBT COLLECTORS CALLS, is to send them a letter that demands that they stop calling you both at home and (if employed), your employer!

It is a good idea to send the letter via certified mail so you have proof that they received it.

You should also keep a copy of the letter.

The debt collector may only contact you once more to tell you they received the demand letter.

If they continue to call, you should report them to your state attorney general's office by going on line to file a complaint.

You should keep a log of all calls, time of day, etc.

A debt collector cannot discuss your debt with neighbors, family or friends without your consent!

A debt collector can only contact others to find your address, phone number or where you work.

Harassment!

  • Debt collectors are prohibited from:
  • using obscene or profane language
  • making many, many annoying calls (many times via computer dialer)
  • using threats of violence
  • making false statements, such as threatening a legal action if they do not follow through
  • falsely claim to be a government agency
  • threaten to seize, garnish or sell your property to pay the debt (unless they have been awarded a legal right through the courts)

 What can you do if a debt collector has been awarded a judgment against you?

You may want to get advice from an attorney (yes, expensive), but it is VERY IMPORTANT that you don't ignore a summons, notice of levy or garnishment.

Once a debt collector has been awarded a judgment, they can apply for a writ of garnishment and also for a levy of your bank accounts.

The best thing you can do is to contact the debt collector immediately after receiving a letter and do you best to settle the debt.

Debt Relief NW can help you:

  • Stop collection calls
  • Negotiate debts for 50% or less in many situation
  • avoid garnishments and bank levies
  • avoid bankruptcy

FOR A FREE CONSULTATION WITH NO OBLIGATION, CLICK HERE TODAY!

 

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Tags: debt collection, fdcpa, debt collection harassment, debt settlement in oregon, garnishment

Can My Retirement Income Be Garnished?

can retirement income be garnished

Most retirees ask me "Can my retirement income be garnished?"

For the most part, the answer is NO when you are dealing with unsecured debts, such as:

  • Credit Cards
  • Personal Loans
  • Medical Bills
  • Store Cards
  • Etc.

However, if you have delinquent taxes or other secured debts, you should definitly check with your tax advisor or attorney.

If you have accumulated too much unsecured debt then your RETIREMENT INCOME IS EXEMPT FROM GARNISHMENT! According the the federal Trade Commission, not only is your retirement income exempt, so are:

  • Social Security  Benefits
  • Supplemental Security Income (SSI)
  • Veteran's Benefits
  • Civil Service and Federal Retirement and Disablility Benefits
  • Military Annuities and Survivor Benefits
  • Student Assistance
  • Railroad Retirement Benefits
  • Merchant Seaman Wages
  • Longshoremen's and Harbor Workers' Death and Disability Benefits
  • Foreign Service retirement and Disability Benefits
  • Federal Emergency management Agency Federal Disaster Assistance

Can a creditor garnish my bank account to get at my retirement income?

Sometimes they can.  It's extremely important to NEVER CO-MINGLE FUNDS from retirement sources with any EARNED INCOME your bank account!

Let's say you are retired, but working a part-time job to make ends meet.  If a creditor is awarded a judgment (and this would be only after you had received a SUMMONS), and you have CO-MINGLED your funds, your bank may be forced to FREEZE YOUR ACCOUNT!

It is a very good idea to keep separate accounts (and I recommend SEPERATE BANKS just to be safe) for income from your part-time job.  Or, you could always just CASH YOUR PART-TIME CHECK to be safe.

If you are receiving calls from collectors, we can help!

If you have delinquent, unsecured debts, we may be able to negotiate a reduced settlement by up to 50% or more! Click on the following link for more information -->

can my social security be garnished

 

Tags: federal trade commission, exempt income, garnishment

Are Social Security Benefits Subject to Garnishment?

can social security be garnishedCan Social Security be garnished?

"I got a call today and the collector told me that if I didn't send them money today my social security benefits could be garnished." -Anonymous

Before you start to panic, you need to know your legal rights according to the Federal Trade Commission and the Fair Debt Collection Practices Act

The following benefits ARE NOT SUBJECT TO GARNISHMENT:

  • SOCIAL SECURITY BENEFITS
  • SUPPLEMENTAL SECURITY INCOME (SSI)
  • VETERANS BENEFITS
  • CIVIL SERVICE and FEDERAL RETIREMENT and DISABLILTY BENEFITS
  • MILITARY ANNUITIES and SURVIVOR'S BENEFITS
  • RAILROAD RETIREMENT, MERCHANT SEAMAN WAGES
  • LONGSHOREMAN'S and HARBOR WORKER'S DEATH and DISABLITLY BENEFITS
  • FOREIGN SERVICE RETIREMENT and DISABILITY BENEFITS
  • FEDERAL EMERGENCY MANAGEMENT AGENCY FEDERAL DISASTER ASSISTANCE

Although these benefits are EXEMPT, it is very important that you are extremely careful about the funds in your bank account!

As long as the funds in your checking or savings account only came from benefits (such as above) and ARE NOT CO-MINGLED with income you may earn in addition, then your account cannot be levied.

CO-MINGLED means that you deposit exempt benefits (such as above) with other income:

  • W-2 income from you job
  • Part-time income
  • Funds your receive from any other outside sources

 DO NOT DEPOSIT WITH THE FUNDS FROM

YOUR EXEMPT FUNDS!

If you have another job, make sure to either just cash that check or open another bank account, preferably in another bank for those funds.

If you have a substantial amount of un-secure debt such as credit cards, personal loans, collections, or medical bills, and are not able to keep up with the payments, you need help!

Since most debt collectors are professionals, trained to say anything in order to get you to send them money, you should consider the services of a DEBT MANAGMENT COMPANY.

They may be able to:

  • Limit or stop the harassing calls
  • Negotiate a reduced settlement help lower your payments and fees
  • Help improve your credit score as debts are paid off
  • GIVE YOU PEACE OF MIND!

Did you receive a Summons? If so, we can help you. Request more information or give us a call for a FREE consultation!

social security benefits subject to garnishment

 

photo by: aflcio

Tags: can social security checks be garnished, stopping debt collection calls, garnishment