Once a debt has been sold to a collection agency, that agency owns the debt. Now it would be between you and the collection agency to settle the debt; the creditor has washed his hands of the matter. If you think the debt collection agency isn't working within its legal limits and is harrassing you, check out the Fair Debt Collection Act, which outlines was a collection agency can and cannot do.
Of course. Your saying the person/co you owed money to (the creditor) went bankrupt. So? His/its bankruptcy does not relieve or change YOUR debt in any way...whether he transferred the debt or not, before or after filing. In fact, the debt you had to that bankrupt party is an asset of its. Hence, when he declared bankrutpcy it is very commonly given to one of HIS creditors as a way to pay them.
It means the original creditor has given up the account and sold it to a collection agency. It does not mean the debtor is relieved of the debt. Someone wants the money and they will get it, somehow.
Yes, a creditor/collection agency must obtain a writ of judgment from the civil court in the state where the debtor resides before any action can be taken against the debtor's property. The debtor will receive a final notice of judgment and be given a specified time to claim all exempted property from judgment action.
Unless you have given a collection agency written permission to pull a full credit report they are in violation of credit laws.
The term assigned in this instance means the original creditor has assigned or given the right to collect the debt from you to another entity, such as a collection agency. If there is a proper assignment, you no longer owe the money to the original creditor and it may likely refuse to accept payment. Now your debt is owed to the company the debt was given to. Sometimes, unpaid debts are sold to collection companies for maybe 50% or some other higher or lower percentage of the unpaid amount. Now the collection agency owns your debt. This is why you might be able to make a deal with the collection agency to pay less than the amount owed. If a collection agency pays 50% of the debt, then contacts you, it will want the full amount. If you can't pay it they will sue. However, suing and collecting the full amount through garnishment is a slow, time-consuming process. Often the agency prefers to get something more than it paid in order to make a profit. If the agency paid $500 to buy a $1,000. debt, it might be very happy to get a payment from you in a short time for $700. That way it made a quick $200 with not much work. Remember when dealing with collection agencies that claim the debt has been assigned to them for collection, you have a right to see that assignment in writing before sending them anything.
All creditors are given notice of whenever a BK is filed. They have the option of filing to block the Bk proceedure for any debt owed them if they believe the debtor is able to pay. Usually this is done by a secured creditor.
Collection agencies are governed by federal and state laws. Debtors are given protection under the Federal FDCPA. A collection agency cannot "threaten" you with anything. They can inform you that your account may be referred to a collection attorney and legal action may be initated. Please familarize yourself with the laws pertaining to collection agencies. Be advised, that some of the laws do not apply to the original creditor.
Collections agency typically are given a year or more to collect on any account before it is sent on to another agency by the creditor. Some creditors use individual agencies exclusively and do not continue to forward accounts. By federal law, activity to secure paymant against a debt may continue for seven years from the date of last payment. In the event the debt has not been paid in full, the creditor may seek judgment against the debtor. In this event, judgment extends the time to ten years from the date of the judgment. If the creditor is unable to satisfy the judgment in ten years, they may petition the court for an additional ten years. Effectively, debt collections activity, if planned right can extend for twenty-seven years.----------------------------------------------------------------------------------------Every state has its own Statute of Limitations.For example, a written contract can have a Statute of Limitations of 3-15 years, depending on the state.
Legally, yes. But it is unlikely that a creditor would take such action.
A creditor has a right to demand that a debt be paid. If someone borrows money and then chooses not to pay that money back, a creditor can attempt to collect that debt using every legal measure possible. Just as people in debt have rights, people that are owed that debt have rights. In the beginning, a court is usually left out of the equation. Collection agencies are often used by creditors in an attempt to collect a debt. Sometimes a creditor will choose to deal with the borrower directly. It’s up to the individual creditor as to what they need to do in order to collect the debt. Secured Transactions are used before the loan is given out in order to encourage the repayment of loans. For example, before being given money by the creditor, the creditor may require a payment up front or be asked to give permission to take away property if the debt isn’t repaid. This encourages the debtor to repay the amount they borrowed. Courts are sometimes needed in order to make seizures of property possible. A creditor has a right to ask a court to help them collect a debt, though most of the time every other option must be exhausted before this measure is used. It’s preferable for debtors and creditors to keep the problem out of court so that court costs aren’t incurred and both parties are able to retain dignity. Although rare, lawsuits are possible. When every other means has been used, it’s possible that a creditor will sue the debtor in another attempt to collect the debt. At this time the court is going to put a tremendous amount of pressure on the debtor to make them repay the debt. They might even be asked to pay more money for their debt than they originally owed. Many times a settlement can be reached before courts come into action. A collection agency can help settle debt without having to send the matter to courts and most of the time this is the option that creditors opt for. The important thing to remember in all of this is that borrowers aren’t innocent victims. They borrowed money from the credit and as a result have a legal right to do what they can to recover the money they’ve borrowed. The law does restrict how they must behave during the collection process, but they have the right to attempt to collect a debt.
Yes. I foreclosed on a home and bought another one cash before being discharged from bankruptcy. I was told by the attorney that creditors can ask the courts and the court will confiscate your purchased product and sell for whatever amount and that amount will be given to the creditor(s).
Under the given circumstances the consumer would probably be termed "judgment proof." Meaning a lawsuit would be futile for the creditor. Some creditors will file suit anyway. To obtain a judgment, for possible collection of the debt in the future. Some judgments are valid for ten years and can be renewed. The consumer can send a "judgment proof" letter to creditors letting them know legal action would be pointless. This is sometimes effective, especially if the debtor can supply proof of their status.
Typically when a collection agency is offering a settlement, it is because the debt is considered toxic and therefore worthless to the original creditor. Many collection agencies use scare tactics to try and coerce you into pay the debt. The first thing you should do is take a look at the age of the debt. Depending on your locality, the debt may be nearing the Statute of Limitation (Varies between 3 and 15 years in the US by state. Average though is 6 years). The Statute is based off the last payment or charge by you on the account (Financial Charges, Interest and such by the creditor do not count). Also, look at your credit report and score. Contrary to what many collection agencies will tell you, debts that they have been given an offer to settle on will not have a positive outcome for you should you settle. Once the account goes to an agency, it has already been charged off and deemed worthless to the creditor. The creditor is simply hopeful for some money at that time. Yes, they have to report that you made a payment, but that doesn't reverse the damage in any way. It will not improve your credit score nor move the account into the positive reports on your credit report files with the Credit Bureaus. Another thing you can do if you don't want the third party collection agency to continue contacting you is write a letter to them informing them that you wish them to cease all communication, to which by law they must honor such a request. It must be done in writing however. An oral request over the phone does not count.
No, collection agencies cannot garnish a person's wages, in the state of Georgia. They can threaten and use many scare tactics to get a person to pay their debts, but they cannot take any money that is not given to them.
A judgment will stay on your credit report for at least seven years. Only time will remove this. Just adding to the answer given. There is one way to have a judgement removed from your credit report. Although this is not a guarantee, you do have a right to contact the creditor to work out a deal to have the judgement removed. When you do this offering to pay the debt in full or make installments can be helpful. Only agree to do this when the creditor has made an agreement to erase the judgment off of your record. This must be in writing. If this does not work the use of a qualified attorney can help to make this happen. Creditors have the power to have judgements removed. Some will be happy to work with you and some will refuse even when offering to pay the balance.
Legally they can't, once the bankruptcy is filed it places an automatic stay on collection attempts/calls, lawsuits, garnishments, repossessions,foreclosures and so forth. Creditors are given the opportunity to request the stay be lifted but this generally involves secured property. A few exceptions might be where a judgment which does not exceed the person's insurance coverage or multi-party cases. If a creditor violates a bankruptcy stay the debtor should contact the attorney handling the BK or the court administrator where the BK petition was filed.
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When a credit card is charged off it means that the company has given up on trying to collect funds on the card and they usually sell the rights to a collection agency and the collection agency will try any means possible to get some money out of you. They usually will send official letters, email, and call your house phone, cell phone and work phone if they have access to this information.
What actually happens is that creditors are monitoring your credit report for hits and activity. When you reopen old debt meaning that that old dormant account shows new activity such as a repayment other creditors will pick that up. More importantly than the fact that you have started to pay other creditors is an interest in updated information you may have provided regarding new address, employers, banking info etc you may have given in an attempt to satisfy the creditor that you are trying to repay which is used to locate you and your money in an attempt to collect their debt also.
No, in general, you may not be sued if you have filed for bankruptcy. For individuals under both Chapter 7 (liquidation) or Chapter 13 (payment plan), the mere filing of the bankruptcy papers puts into effect what is called the "automatic stay" under Title 11 United States Code Section 362.The automatic stay immediately prohibits all attempts at collecting on debts. It prevents creditors from filing new lawsuits as well as proceeding on ones already pending. It even puts an end to garnishments already in place. Creditors are forbidden to write to, telephone or contact the debtor in any manner to collect a debt while the bankruptcy action is pending unless permitted by the bankruptcy court.There are some exceptions in 11 USC 362(b) for certain creditors (such as ones filing suit to recover secured or mortgaged property); however even these creditors must first get permission from the bankruptcy court to institute or continue such collection actions.In practice, notice of the filing is sent to the listed creditors by the bankruptcy court and copies of the bankruptcy filing are given to all the creditors listed in the filing by the debtor or debtor's attorney so that they have actual notice of the automatic stay. Sometimes the debtor or debtor's attorney gives informal notice immediately to a creditor just so the creditor knows right away to stop trying to collect.The purpose of the automatic stay is to ensure that all collection action with regard to the debtor is coordinated through the bankruptcy court and so that no creditors get more than they are legally entitled to get from the bankrupt's assets.A person may remain open to collection actions for debts contracted after the bankruptcy filing.Additional Point:Of course yiou can be sued for new things or things not addressed in the BK. But to collect a debt that is part of the process, the creditor must follow the process and cannot start a new law suit.
A creditor can call you on Sunday. The hours they can call are 8:00 am-9:00 pm. If you have spoken to a creditor once during these hours on a given day, they are not allowed to call back that same day.
It is assumed the creditor won a lawsuit against you and the court issued a judgment lien. You should have had notice of the hearing and received a letter of judgment against you from the court. You must pay off the lien in exchange for a release of the lien. You may also go to court to challenge the validity of the lien, the lien amount or raise any other matter that might affect the legality of the lien. When a collection agency first puts a lien on a bank account. The bank usually may not give those funds to the collection agency immediately. Notice of the lien is given to the debtor, who then has a short time period to apply to the court to object to the turn over of the bank account to the agency. If an objection is made, the bank will not give over the money until the court rules on the objections and issues an order directing the bank to pay all, some or none of the bank funds to the agency. If no action is taken by the debtor within that time period, the bank may turn the money over to the agency without a court order. See related link.
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