More Consumers Refuse to Be Cleaned Out by ‘Messy Business’ of Debt Collection

Dr. Chris DeRitis, a consumer credit expert at the economic research and consulting firm Moody’s Analytics, told the Times-Tribune of Scranton, Pennsylvania, that all debt collection is under the microscope. “A lot of this debt gets traded three, four or five times,” Dr. DeRitis told the Times-Tribune for the story published on October 21, 2012. “It’s a messy business.”

The Times-Tribune noted that many collection agencies that buy debt do not have all the documentation to support the original agreement, meaning many companies are filing debt-related lawsuits with “insufficient records, faulty documents and questionable claims.”

“Some companies are doing this more responsibly than others,” Dr. DeRitis told the Times-Tribune. “There are cases of fraud where unscrupulous debt collectors put charges on people’s accounts.”

Allegheny County Judge R. Stanton Wettick, who has presided over “hundreds of cases in which banks sold delinquent credit card accounts to debt buyers who filed litigation to recover the money,” told the Times-Tribune that sometimes the affidavits do not appear to be signed by the right people. The story noted that debt collectors frequently prevail in court because many defendants in credit card suits never contest the action. “If 100 get filed, 75 turn into default judgments,” Judge Wettick told the Times-Tribune.

However, the Times-Tribune also pointed out that because default judgments enable debt collectors to freeze a consumer’s bank account or garnish wages to recover obligations, more consumers are now challenging the evidence. “For a lot of companies now, if someone shows up and contests it, it may not be worth their while to pursue it,” Judge Wettick told the Times-Tribune.

If you are being harassed by debt collectors about your credit card debt , filing Chapter 7 or Chapter 13 bankruptcy will end those phone calls. You may be able erase your credit card bills and other unsecured debt by filing Chapter 7 bankruptcy , or you could pay back a fraction of what you owe through a Chapter 13 plan. Contact our firm at (866) 930-7482 or complete the form on this page to have our Chicago bankruptcy lawyers determine which plan would work best for you.

Benjamin Brand Services – Chicago bankruptcy attorneys

30 Million Americans Dealing with Debt Collection Industry

This video is from a March 2009 Dateline NBC segment on the dirty tactics used by debt collection agencies in the United States. While the segment is more than three years old, little has changed in that time. If anything, the problem has only grown worse.

On August 20, 2012, the Los Angeles Times reported that debt collection has become a $12 billion a year industry with an estimated 30 million Americans dealing with debt collectors this year. According to the Times, that is a nearly 50 percent increase since 2003.

One person the Times article featured was Piqua, Ohio, resident Katie Brown. She told the Times that she received a call about her unpaid $3,000 credit card bill from Hhgregg Inc. The person claimed that he was from a free legal aid service that Brown had contacted to try to end harassing phone calls from debt collectors.

“After I told him everything, he laughed and said, ‘Now let me tell you who I am. I hold your debt from Hhgregg,'” Brown told the Times. “I was scared they would get to my husband’s work and start calling them, because at this point they would stop at nothing if they were going to misrepresent themselves.”

As the Times article noted, more people have increasingly fallen behind on their bills for credit card debt, student loans and other expenses in the Great Recession. If you are also facing harassing calls from debt collectors, the good news is that filing Chapter 7 and Chapter 13 bankruptcy will trigger an automatic stay that requires most debt collectors to stop all collection efforts against you until the bankruptcy is over.

If you would like to learn more about filing bankruptcy and receiving an automatic stay, you can use the form on this page to have our Chicago bankruptcy lawyers review your case or you can contact our firm at (866) 930-7482 to schedule a free consultation.

Benjamin Brand Services – Chicago bankruptcy lawyers

Is Robo-Signing Sequel Being Put on Plastic?

On Wednesday, we discussed how some Chicago-area homeowners are now dealing with foreclosure notices as lenders begin to tackle backlogs that were amassed while states investigated “robo-signing” fraud. As it turns out, the practice in which bank employees sign thousands of documents and affidavits without verifying the information was not just limited to foreclosures.

On August 12, 2012, the New York Times reported that the same “robo-signing” problem is now emerging in the debt collection practices of credit card companies as well. Judges who oversee these cases told the Times that lenders are “churning out lawsuits without regard for accuracy, and improperly collecting debts from consumers.” Worse yet, many judges told the Times that “their hands are tied” and they cannot question the banks or comb through the lawsuits to root out suspicious documents unless a consumer shows up to contest the lawsuit.

“I do suspect flaws,” Harry Walsh, a superior court judge in Ventura, California, told the Times. “But there is little I can do.”

“I would say that roughly 90 percent of the credit card lawsuits are flawed and can’t prove the person owes the debt,” Brooklyn civil court judge Noach Dear told the Times. He said he presided over as many as 100 such cases a day .

Are you being harassed by debt collectors for outrageous-possibly even exaggerated-credit card payments? You may be able to wipe out your credit card debt by filing Chapter 7 or Chapter 13 bankruptcy . Contact our firm today at (866) 930-7482 or complete the form located on this page to see how our Chicago bankruptcy attorneys can help.

Benjamin Brand Services – Chicago bankruptcy lawyers

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