http://www.destroydebt.com/ Destroy Debt is an online community which provides regular articles showing practical ways to eliminate debt. www.destroydebt.com Sat, 21 Nov 2009 06:39:43 GMT webmaster@destroydebt.com webmaster@destroydebt.com http://www.destroydebt.com/articles/unsecured-creditors-and-bankruptcy.html http://www.destroydebt.com/articles/unsecured-creditors-and-bankruptcy.html Wed, 18 Nov 2009 06:00:00 GMT Dealing with bankruptcy can be frightening event.  Bankruptcy is meant to give a fresh economic ‘leg-up’ to people who have made some financial errors.  There are two basic types of bankruptcy, Chapter 7, total discharge of debt, and Chapter 13, a reorganization of debt.  There are rules for filing for bankruptcy and conditions must be followed.
A Chapter 7 case is only available to individuals and the debtor has no liability for discharged debts.  Although the right to a discharge is not absolute, and some types of debts are not discharged.  

Determine Your Eligibility 

Before filing for a second bankruptcy, a debtor must wait eight years after the discharge of the initial bankruptcy charge under Chapter 7 rules.  If a file has been made under Chapter 13, the individual must wait six years before filing an individual, Chapter 7, bankruptcy.  It is important to have the official discharge date of the original debt.  Depending on the type of debt filed Chapter 7 for individuals or Chapter 13, as each has different rules. 

Depending on your situation, bankruptcy may not be an alternative for you.  Prior to filing for bankruptcy a financial management course must be taken and working with a credit counselor is also a requirement.  To prevent filing and re-filing for bankruptcy again and again you must undergo financial counseling.  It is hoped that the counseling will prevent the reoccurrence of future predicaments.   Eligibility can be granted if these requirements are met. 

Engage the services of a specialized attorney to determine your eligibility for filing bankruptcy for a second time.  Bankruptcy may not always be the right road to follow.  Sometimes individuals fail to meet the requirements or have too much income to qualify for bankruptcy.  The median family income is determined on a state by state basis. The attorney will perform tests and determine if your income is too low for the debt your have. 

File the Papers 

You can file your bankruptcy claim through an attorney or a local bankruptcy court.  An attorney is not required, but the process is complicated and time sensitive.  If the deadlines are not met, the case may be thrown out of court. After completion of the papers, and once they have been approved by the court system, the courts will assign a bankruptcy hearing. It usually takes four to six weeks to receive the debt discharge statement.  Under Chapter 7 (Individual) protection, creditors may not proceed with any further claims against you.  Under Chapter 13, there is a repayment plan will be instituted, requiring repayment which may last between two and three years.

Filing for a second bankruptcy may or may not be an option for you. The key is to learn financial lessons and implement them into your daily life to prevent further debt and additional bankruptcies.]]> http://www.destroydebt.com/articles/making-payments-to-collection-agencies.html http://www.destroydebt.com/articles/making-payments-to-collection-agencies.html Wed, 18 Nov 2009 06:00:00 GMT So you are in a financial slump.  With the current state of the economy, many people are there now too.  Just when you thought that things couldn’t get any worse, debt collectors begin calling and harassing you on the phone. Who are these callers and how did they find you?
If a debt collector is contacting you, it usually means your account is in default, has been written off the books as a loss, and has been sold to a collection agency.  Debt collectors make their money by purchasing your debt for a percentage of what it’s worth, and then try to squeeze as much money out of you as possible in order to make a profit. They often do this by harassing the person that has defaulted on their credit card or bank loan.  You may not realize it, and they will probably not tell you, but debt collectors are governed by the rules outlined by the Federal Trade Commission in the Fair Debt Collection Practices Act (FDCPA).  So, what should you do next? 

Take Action 

• Talk to the collector and find out if the debt is really yours, how much you owe, and to whom.
• Document all interactions you have with the agency.
• Get the name of the person who is calling you, what agency they work for, their address, and phone number.
• Ask the collector for a verification letter to determine if the debt is really yours.
• If you want them to stop calling you, send the agency a certified letter asking them to stop and to contact you in writing only.
• If you determine that the debt is really yours, try to negotiate with the agency an amount that you can realistically afford to pay each month in order to get rid of the debt as quickly as possible.

   

• Because collection agencies purchase your debt for pennies on the dollar, they are often willing to negotiate for a percentage of the original debt that you owed.  Make sure if you agree to anything with the debt collector that they send it to you in writing.

   

What Can The Collection Agency Do? 

• The collection agency must send you a “Validation Letter” explaining what you owe and to whom within five days of contacting you.
• if you have hired an attorney, the collection agency should only be communicating with your attorney and not you.
• They can sue you for the debt that is owed and then garnish your wages if they win the lawsuit against you.

   

What Is The Collection Agency Prohibited From Doing? 

• The debt collectors do not have “carte blanche” to contact you whenever and wherever they want.  They are not supposed to contact you before 8 in the morning or after 9 at night. 
• If they are bothering you at work, you can tell them either orally or in writing that you are not to be contacted there.
• The collection agency cannot discuss with anyone except you, your spouse, or your attorney any information about your debt.
• They cannot harass or threaten you.
• They cannot make any false statements about you to anyone about your debt or to you
• They cannot make any false statements about who they are.
• Collectors may not engage in any unfair practices such as trying to collect extra fees or taking money out of your account without authorization.

   

For more specific information about what collection agencies can and cannot do, visit the Federal Trade Commission at www.ftc.gov/credit.  If you believe that a collection agency has violated your rights and the law, contact your state’s Attorney General’s Office or the Federal Trade Commission at www.ftc.gov. ]]> http://www.destroydebt.com/articles/collectcorp-collection-services-.html http://www.destroydebt.com/articles/collectcorp-collection-services-.html Thu, 12 Nov 2009 06:00:00 GMT Providing debt recovery services since 1978, Collectcorp Corporation boasts public and private sector clients in Canada and the United States.  Offering third party recoveries, first party outsourcing, skip trace programs to banks, governmental agencies and private companies.  

Collectcorp was formerly known as Equifax/Collectcorp Inc. and based in Toronto, with contact centers in Phoenix, Az., Williamsville, NY, and in Cornerbrook NFLD., Oshawa, ON., Canada. Past Director of the International Credit Association, Nicholas Wilson, CEO and founder of Collectcorp has been the visionary and architect of Collectcorp's growth for the past 26 years. 


However, some consumers are unimpressed with the way in which the company consistently calls to request payment on accounts.  In one instance a person was receiving 4-6 messages a day regarding his delinquent account. Rather than deal with the collector directly, this person decided to leave a message, after hours, on the company answering machine requesting information regarding the account.  This was to permit the recording of the message and the answer. The first message did not elicit a response. Again he called and requested further information regarding his account, and outlined his issues with them.  Once again, no reply yet calls continued to him (2 per day). He then called again and left a message stating that he would be retaining the efforts of a lawyer to investigate any statutes that they were in violation of, and that any further discussions must be recorded.  This was the last time he has heard from them. 


Many other consumers have similar tales from Collectcorp. One customer called to request the company fax number.  The receptionist refused to divulge the information but rather requested the last 3 digits of the customers Social Security Number. After declining to give the receptionist any personal information, such as telephone number or address, the receptionist hung up on the caller.  


If this company or any other debt collector contacts you about an unpaid bill, request a letter in writing, a validation notice, and full information about the debt. If you suspect that they have made a mistake and are contacting you erroneously tell the collector, in writing, that they are mistaken and to stop contacting you. Debt collectors may not harass people they contact.  They are not allowed to: 

• Use threats
• Use violence
• Publish your name or names of people who refuse to pay their debts
• Use profane language
• Repeatedly use the phone to annoy people

]]> http://www.destroydebt.com/articles/bankruptcy-alternative-services.html http://www.destroydebt.com/articles/bankruptcy-alternative-services.html Thu, 12 Nov 2009 06:00:00 GMT The downturn in the economy and rising consumer debt has caused the number of Americans filing for bankruptcy to grow.  According to the Administrative Office of the U.S. Courts, there were over 520,000 bankruptcy fillings in the first half of 2008.  Bankruptcy is a federal court process that helps consumers remove their debt in bankruptcy court.
There are two types of bankruptcies:

1. Chapter 7-allows you to have a fresh start when your debt load is out of control.  This type of bankruptcy is also known as asset liquidation.  You sell all non-exempt property and use the money to pay off debt. This is the last choice if you are in severe finical straights.  It’s best to take this option if you no longer have an income.  Chapter 7 bankruptcy remains on the credit report for 10 years and has the potential to interfere with employment opportunities.  There are new federal guidelines that make it more difficult to file for chapter 7, but once you have qualified and filed, all lawsuits, liens and wage garnishes stop.

Chapter 13- You can repay your debts with little to no interest using whatever income you have or may have in the future.  This type of bankruptcy is also known as restructuring.  You are protected by the courts and cannot be harassed by collection agencies.  It stays on your credit report for 7 years and usually does not affect employment possibilities.  Just like in Chapter 7, the federal court stands behind you to stop harassment by debt collectors.

Alternatives To Chapter 13 Bankruptcy:

1. Debt settlement-You can hire a company or you can negotiate with the lender yourself.  In debt settlement you or your representative negotiates with creditors to lower the amount owed on a debt.  You end up settling for paying off the debt for less than you owe.

2. Credit counseling services-You or a credit counselor negotiates with a bank or credit card company to reduce the interest rate on debt.  This will lower your payments or can be rolled into one low interest lump payment.

Bankruptcy is a path no one wants to travel but there are ways to avoid it to find financial peace again.]]> http://www.destroydebt.com/articles/midland-funding-collections.html http://www.destroydebt.com/articles/midland-funding-collections.html Tue, 27 Oct 2009 06:00:00 GMT Midland Funding, LLC is an incredibly popular search term. A recent search of Google for "Midland Funding, LLC" showed 2,270,000 results, the first several pages of which were accounts of problems with Midland Funding, LLC and results of court cases.

According to the Better Business Bureau, Midland Funding, LLC, is owned by Encore Capital Group, Inc. and operates in several locations, including San Diego, CA, Phoenix AZ, St. Cloud, MN and Gurgaon, India. The Better Business Bureau has another listing for Midland Funding, LLC in North Carolina, but it reports that location is out of business. 


Encore Capital Group, Inc. is a debt collection agency that purchases unpaid debts from credit originators and attempts to collect those debts from consumers. The umbrella company for Midland Funding, LLC, states on its website that it holds integrity, respect, fairness and collaboration as values. Looking through several pages of results for Midland Funding, LLC, however, suggests otherwise. 


While many people hold debt collection agencies in contempt, they do provide a legitimate business service by attempting to collect unpaid debt. However, debt collection agencies are required to act within the law, as spelled out in the Fair Debt Collection Practices Act, a federal law enforced by the Federal Trade Commission. Many states have their own debt collection laws, which can differ from the federal regulations, so whenever someone has questions regarding a debt collection agency, it is wise to consult the laws in your state. The Fair Debt Collection Practices Act does allow debt collection agencies to collect money owed to others, within the guidelines under the act. Debt collection agencies, including Midland Funding, LLC, may not harass, threaten or abuse consumers, nor may the use unfair or deceptive practices to collect a debt. 


The Encore Capital Group, which lists Midland Funding, LLC as one of its business names, has an A+ Rating from the BBB and is an accredited Business with the BBB since May 2000. This means the Encore Capital Group, Inc. and, presumably, its subsidiaries meet the standards set by the Better Business Bureau. There is no doubt, however, that Google Search Engine Results Pages show complaints against Midland Funding, LLC some 30+ pages deep. 


If you have dealings with Midland Funding, LLC, or any other debt collection agency, they must follow the guidelines set forth in The Fair Debt Collection Practices Act as well as in the state in which business is conducted.  
 ]]> http://www.destroydebt.com/articles/javitch-block-rathbone-collections.html http://www.destroydebt.com/articles/javitch-block-rathbone-collections.html Tue, 27 Oct 2009 06:00:00 GMT Javitch, Block and Rathbone, LLP is a predominant Ohio based law firm that specializes in collections.  They are the fourth largest collection law firm in the country.  Their offices are located in Cleveland, Cincinnati and Columbus Ohio and they service a three state radius including Ohio, Indiana and Kentucky.  Most often their clients include banks and credit unions, department stores, credit card companies, medical billing companies, insurance companies and rental companies.
According to their website, Javitch uses highly specialized and aggressive techniques to collect money for their clients.  They have a team of highly experienced personal that work diligently to get the job done.  Each team member specializes in a particular area of collections to allow for the most promising results.  They are trained to use highly effective collection techniques such as skip tracing.  One of the reasons the law firm is so popular, is that it allows its’ clients to skip the middle man.  Companies seeking to collect past due money from faulty clients can avoid fees and the time that bills are held up in traditional collection agencies. 

Once Javitch receives a collection case, they analyze the situation and take immediate action.  Each case in handled individually.  With knowledge and experience the Javitch team of attorneys, collection specialists and other personal are easily able to determine which collection technique will work best with each case.  They then go to work to locate, contact and collect the amount due. 

Javitch is active in, and belongs to a variety of professional organizations that add to its’ repertoire.  These include The National Association of Retail Collection Attorneys, Commercial Law League of America and The American Collectors Association. 

Javitch, Block and Rathbone, LLP also has many well known clients including Chase Manhattan Bank, Toyota Motor Credit and General Electric Capital Corporation.  Their clients have helped Javitch to be recognized and rewarded for their top notch performance. 

On the flip side, it is important to note that Javitch Collections is not accredited by the Better Business Bureau.  Not only are they not accredited, but their Better Business Bureau ranking is only a C-.  The BBB reports that over the last 36 months they have received 39 complaints with 35 of those complaints being of billing or collections issues.  In one such complaint the BBB shows that Javitch has refused to respond.  Keep in mind that these complaints could be coming from unhappy customers of the clients that Javitch represents, not their actual clients. ]]> http://www.destroydebt.com/articles/does-debt-management-cost-money-.html http://www.destroydebt.com/articles/does-debt-management-cost-money-.html Thu, 22 Oct 2009 06:00:00 GMT With today’s economy, debt management is at the forefront of almost everyone’s mind. However, many people may be confused about where to start managing their debt. They may believe they have to spend large amounts of money on debt management assistance.

Debt Management Doesn’t Have to Cost Money 


If you’re concerned about managing your debt, you are probably watching your money very closely and don’t want to spend it frivolously. The good thing is there are many free sources of debt management information available to you. 


Search the Internet for Debt Management Resources 


Thanks to the internet, access to debt management information is easy and convenient. Search for phrases such as “debt management tips” or “debt management advice” to get started. Watch out for sites that charge you a fee for these tips or require you to enter personal information – sites like this are often not legitimate. 


Reduce the Number of Your Debts 


Many people owe money to several places. If you can reduce the number of these creditors, you can manage your debt easier. For example, many people have several store credit cards or loans. If you are able to reduce the amount of store credit cards you have, or consolidate your loans, you can have a more manageable debt load. 


Create a Budget 


A budget is essential for debt management. This should include all income (such as salary, pension or child support) and expenses (such as car payments, groceries, entertainment and rent). If you aren’t sure about your expenses, start keeping all your receipts and store them in the same location for easy reference. Once you’ve created your budget, you should be able to judge where you can reduce your spending or increase your income. This will help you feel more in control of your finances. 


Negotiate With Credit Card Companies 


If you’re struggling to make credit card payments, there is hope. Credit card companies want to get paid as much as you want to pay them, so they are often open to discussing payment plans or a reduced interest rate. Even if your payment history isn’t stellar, your credit card companies may be able to work something out with you.  
 


Managing your debt may be a cause of concern for you. With these free sources of debt management, you can take steps towards reducing your worry and returning to financial health sooner.]]> http://www.destroydebt.com/articles/how-debt-collection-agencies-collect-fees.html http://www.destroydebt.com/articles/how-debt-collection-agencies-collect-fees.html Thu, 22 Oct 2009 06:00:00 GMT Debt settlement is the process in which a creditor agrees to accept less than the full amount owed, but considers the debt cleared.  The debt settlement companies we see advertised in print and on TV claim to negotiate reductions of up to 50 percent.  

Repayment plans can take between two and four years.  However, settlement companies charge fees for their services, usually through one of two approaches.  In one approach the company’s fee is a percentage of the total debt, typically between 18-30 percent. As a part of other approach the company bases their fees on the amount of debt reduction they can negotiate. The fees in this case be as high as 35 percent. 


Many debt settlement companies charge a monthly fee as a part of the program.  The fees range from $18-$89 a month. It’s unusual for settlement fees to total thousands of dollars. 


Some debt settlement companies collect their fees before your creditors see a dime. It could be months before your creditors secure payments. Beware! Sometimes debt collection agencies suggest you stop payments to credit card companies and begin making payments into a third party account.  They then attempt to negotiate a settlement for you with your creditors once enough money is in the account.  This may take several months, depending upon the amount of the debt.  In the meantime, your debt continues to grow, penalty and interest fees continue to accrue. Now you owe more than when you started out.  Worse yet, legal actions such as wage garnishment or judgment may be filed against you. 


Most consumers don’t know that that debts paid off through settlement show up as “paid off by settlement,”  on your credit report.  If you apply for loans or credit when reviewing your report the prospective lender will see the debt was paid through settlement.  This indicates that your repayment didn’t cover what was owed, and the creditor accepted lesser amount.  This will affect the decision to lend or grant credit, a fact not openly shared by a number of debt collection agencies. 


The debt settlement industry is new and largely unregulated.  There are a number of new and inexperienced companies who are unfamiliar or simply don’t care about the laws and regulations that should guide the industry.  It’s a recipe for disaster for the uninitiated, uninformed, in debt consumer.  If you decide to use a debt collection agency to clear your debt issues do your homework. Make sure your money gets put in a third party account and that no money is paid to your agency before payments to creditors are made. Set a reasonable time frame to pay off the debt. Make sure your agency answers all your questions before you agree to their terms. Only then will you feel confident that you’re on your way to recovery.]]> http://www.destroydebt.com/articles/eric-berman-pc.html http://www.destroydebt.com/articles/eric-berman-pc.html Wed, 07 Oct 2009 06:00:00 GMT Eric Berman, P.C. is a group of attorneys specializing in bankruptcy law, consolidating debt and legal services across the country.    On July 22,2009 New York Attorney General Andrew Cuomo filed suit against Berman, 34 other law firms and two debt collectors for failure to properly notify consumers of pending legal action regarding debt collection.
On July 22,2009 New York Attorney General Andrew Cuomo filed suit against Berman, 34 other law firms and two debt collectors for failure to properly notify consumers of pending legal action regarding debt collection.  

All of the companies named in the suit employed American Legal Process to notify New York consumers that they were being sued for failure to repay a debt.  American Legal Process did not follow proper protocol when serving the consumers.  This caused thousands of default judgments to be entered against New York consumers. None of those who had default judgments against them had a chance to respond or defend themselves against the charges. 

ALP was hired as a legal process server by high-volume debt collection law firms to serve summons or complaints notifying consumers that they are being sued and that they must respond. ALP did not notify them correctly thereby denying them the opportunity to respond in court or in writing.  For many New Yorkers the first inkling they had they were in any kind of trouble was when their bank accounts were frozen or their wages were garnished. According to the suit American Legal Process falsified sworn affidavits of service. The false affidavits of service were used to obtain defaults against the consumer. The law firms and debt collectors filed more than 100,000 suits across the state of New York. 

In most states the process server must be an impartial third party. Once the notice has been delivered the process server is expected to file an affidavit of service with the court verifying that the named defendant has been served properly and that in turn is added to the case file.  In the New York case, American Legal Process neglected their duties and falsified documents repeatedly. By seeking default judgments the law firms made use of the falsified documents that claimed the defendants had been given proper notice.  The case is meant to correct the large number of improperly obtained default judgments.  

The case seeks to: 

  Require the firms involved to inform New York State court system of each action in which they used ALP to serve legal process and in which cases a default judgment was granted. 

Notify all parties in those actions of the existence of the lawsuit and their right to be heard. 

Notify the court of amount of any default judgments taken in any relevant actions as well as whether the debtor paid any amount to satisfy the default judgment.]]> http://www.destroydebt.com/articles/allied-interstate.html http://www.destroydebt.com/articles/allied-interstate.html Wed, 07 Oct 2009 06:00:00 GMT Allied Interstate is headquartered in West Palm Beach Florida and has been in operation for some thirty years. It has received an F ranking the Better Business Bureau who states, ”We strongly question the company’s reliability for reasons such as:

• They have failed to respond to complaints
  

• Their advertising is grossly misleading
  

• They are not in compliance with the laws licensing or registration requirements.
  

• Their complaints contain especially serious allegations or the company’s industry is known for is fraudulent business practices.

Allied runs large call centers in the U.K, India, U.S, Philippines  and Canada for purposes of debt collection. They are also known as IRMC or Intellirisk Management. Services include debt collection, accounts receivable management, financial services for government agencies and utilities. The debt collection arm of the company has netted Allied hundred of millions from consumers who are unaware of their rights regarding Allied ‘s collection practices. 

Allied has had numerous complaints filed against them stating that even when the amount demanded was paid consumers failed to receive credit for the payment or were charged again. They also have received complaints for trying to collect debts that had already been paid off years ago and the account was never closed. Other complaints range from unprofessional behavior on the phone to the use of inappropriate language in an effort to collect a debt.  

In several states Allied has attempted to collect debt from the wrong person. They initiate debt collection over the phone without sending a letter to the consumer first. When the consumer disputes the debt over the phone they are informed that in order for Allied to consider the consumer’s claim valid they must have proof in writing. They must prove the debt has been paid or they are not the person from whom the debt should be collected, in effect that they are innocent.  

When the request is made by the consumer over the phone to have the bill sent(as is their right) in order to see it in writing it has been refused or ignored.  It has taken the intervention of the Minneapolis Attorney General’s office in one case to settled Allied’s hash. 

The Better Business Bureau is rife with cases of Allied employees harassing friends and family of their targets trying to collect debt, though this a clear violation of the Fair Debt Collection Practices Act. Article 806 states,” A debt collector may not engage in  any conduct the natural consequence of which is to, harass, oppress, or abuse any person in connection with the collection of a debt.” It seems that anyone dealing with Allied should be aware of their rights and be prepared to document the whole ordeal.]]>