Who is a Debt Collector- Creditors and Bottom Feeders
There is too much to write about this subject to fit within thefew pages of this site. But here are some basic concepts to keep-in-mind when deciding whether you have an FDCPAcase.The FDCPA, with few exceptions, applies only to third party debt collectors and not the creditors themselves. These are typically debt collection agencies and, in many cases, lawyers. This means that the creditor (owner of the debt) is generally exempt from the Act. There is an important exception, however. Defaulted obligations of all kinds are purchased by certain companies for pennies on the dollar. These companies refer to themselves as distressed debt buyers. We refer to them as “bottom feeders” which more appropriately describes them. They become debt collectors when they purchase your debt from the original creditor when it is in default. Even though they are creditors they are covered by the FDCPA.
What is a Debt
Not every debt is covered by Act. The debt must be consumer debt. This means that it must arise from a consumer transaction. This generally includes a transaction primarily for personal, family or household purposes. Unfortunately, the Act won’t protect you against a debt collector attempting to collect a business or a commercial debt. Also, the collection of delinquent income taxes, penalties and fines are not covered. Generally speaking, debts which don’t arise from a contract such as those incurred as a result of an automobile accident where you cause property damage or personal injury to another are not covered. However, if you should enter into a written contract or agreement to pay this type of debt then, in our oipinion, the debt is probably covered. Bottom line, the vast majority of debts you will face will be covered by the FDCPA but some won’t.
Types of Violations
The number and types of debt collection practices that violate the statute are too numerous to mention in this brief summary. However, we will attempt to describe a few of the most common that we see. We divide them into two types: technical violations which generally lead only to statutory damages and harassment and abuse which may entitle the consumer to actual damages as well as statutory damages.
False and Innacurate Statements
A debt collector may violate the law if it misstates the character, amount or legal status of the debt. A debt collector may not threaten to take action which is impossible for it to take or may not threaten to take actionthat it has no intention of taking. This frequently takes the form of a threat to file suit on a time-barred debt. Another common one is the threat to garnish one’s wages when a suit hasn’t even been filed; let alone, a judgment entered. Another is the threat of criminal prosecution by collectors for Payday Lenders claiming that borrowers have written a bad check. If borrowers had the funds in their account at the time they wrote their check, obviously, they wouldn’t need to borrow money; therefore, the absence of any possible criminal intent. Frequently, the amount of the debt is inflated and/or there are charges added to the debt which are excessive or improper. For example, the assertion by a debt collector that if you are sued the creditor will be entitled to recover attorney fees. This is not possible in Ohio and many other states if it involves consumer debt. Or the addition of “collection fees” to your bill. No fee can be added unless it is expressly contracted for between you and the creditor or authorized by law
Generally speaking, such representations can take place either inwritten or, more frequently, verbal form where the debt collector states something which is neither factually nor legally accurate or even possible. In any conversation, we deem it wise to allow the debt collector to do most of the talking and you most of the listening .We like to advise that, after any threat from the collector, you ask the question: “Can you legally do that”. In other words, give the debt collector the proverbial sufficient “rope to hang itself.”We recommend that you save all written correspondence that you receive along with the envelope in which it came preserving the postmark date. When receiving telephone calls, if you live in a state which permits one party consent for recording it would be best to record all calls from these people (Ohio & Kentucky are one party jurisdictions). If you are unable to record, try and write a summary containing allverbal threats or representations made by the debt collector as soon as possible after the conversation so you don’t forget and keep doing it after each call.
Time Barred Debts
In this era of massive debt buying, we frequently run into the attempt to collect debts that are time barred. Time-barred debts are those that are barred by the applicable statute of limitations. Generally, the time to calculate is from the date you defaulted or became delinquent. You might get a call or a letter with a demand to pay a time-barred debt which, by itself, is not a violation. It becomes one when the debt collector accompanies the demand with a threat if the debt is not paid (typically, to file suit). Determining if the debt is time-barred is not always easy. Old credit card debt involves one statute of limitations and the default on a retail installment sales contract involves another. This is why you should always consult with a lawyer and make no assumptons.
NEED HELP: Yale Levy operates one of the largest debt collection law firms in the state of Ohio which sues on behalf of countless creditors in every part of the state; many of them distressed debt buyers that we have referenced. Mr. Levy’s office is notorious for committing every conceivable fdcpa violation. Many times intentionally and very often just through negligence and carelessness. In that regard, Mr. Levy’s office has frequently sued or attempted execution against the wrong individual. You also might say it pushes the envelope in connection with its debt collection activity often inventing new “concepts” or “ideas” in debt collection that no one else has thought of using. If you are contacted by the Law Office of Yale Levy or even sued by it, it is well worth your time to contact us first before giving in to Mr. Levy and his staff.