what should i tell a debt collector if i have a lawyer

Full Answer

How do I know if a debt collector is legitimate?

Legitimate collectors should be able to give you a business address and contact information, too. If a debt collector has given you their name and identifying info but you’re still suspicious, you may be able to find more information about the collector via your state’s attorney general’s or consumer affairs office. 3. Right not to be harassed

How do I choose a debt collection lawyer?

Check the attorney’s history using online searches and government sources. Make sure the lawyer has a license in good standing. During a preliminary, in-person meeting, think about whether the lawyer and you mesh well, and ask candid questions about the lawyer’s background in debt collection litigation. Be careful who you choose.

Can a debt collector take a consumer to court?

Debt collectors can take consumers to court to recover money owed and win most of the cases because the consumer never appears in court or sends a legal representative. Consumers who do appear in court with no legal representation are doing themselves a disservice.

Can a debt collector ask you to pay off your debt?

Steps to take to pay off debt in collections Even though you have protections under the FDCPA, debt collectors are still allowed to ask you to repay your legitimate debts. As you navigate this process, there are some important things to consider.

What should you not say to a debt collector?

3 Things You Should NEVER Say To A Debt CollectorAdditional Phone Numbers (other than what they already have)Email Addresses.Mailing Address (unless you intend on coming to a payment agreement)Employer or Past Employers.Family Information (ex. ... Bank Account Information.Credit Card Number.Social Security Number.

When a consumer is represented by an attorney a debt collector?

(6) after the debt collector knows the consumer is represented by an attorney with regard to the subject debt and has knowledge of, or can readily ascertain, such attorney's name and address, not communicate with any person other than that attorney, unless the attorney fails to respond within a reasonable period of ...

How do you outsmart a debt collector?

9 Ways to Outsmart Debt CollectorsDon't Get Emotional. ... Make Sure the Debt Is Really Yours. ... Ask for Proof. ... Resist the Scare Tactics. ... Be Wary of Fees. ... Negotiate. ... Call In Backup. ... Know the Time Limits.More items...•

Can you negotiate a settlement with a collection agency?

Believe it or not, though, it's possible to negotiate with a collection agent and end up paying less than you owe. Why is that? Because the collection agency bought the original debt from your creditor, most likely for a substantial discount. That means they don't have to recover the entire amount to make a profit.

How do I settle a debt lawsuit?

A debt collection lawsuit can potentially be resolved with debt settlement. You can do this on your own or hire a debt settlement attorney to help. You can make a payment plan with the creditor to pay off the sum of the debt or partially pay the sum in a lump-sum settlement.

How do creditors find your bank accounts?

How a Debt Collector Gets Access to Your Bank Account. A debt collector gains access to your bank account through a legal process called garnishment. If one of your debts goes unpaid, a creditor—or a debt collector that it hires—may obtain a court order to freeze your bank account and pull out money to cover the debt.

How do I respond to a collection letter?

Ask CFPBWho you're talking to (get the person's name)The name of the debt collection company they work for.The company's address and phone number.The name of the original creditor.The amount owed.How you can dispute the debt or ensure that the debt is yours.

How do I challenge a debt collector?

Your dispute should be made in writing to ensure that the debt collector has to send you verification of the debt. If you're having trouble with debt collection, you can submit a complaint with the CFPB online or by calling (855) 411-CFPB (2372).

What do you tell a debt collector when they call?

Here's some basic information you should write down anytime you speak with a debt collector: date and time of the phone call, the name of the collector you spoke to, name and address of collection agency, the amount you allegedly owe, the name of the original creditor, and everything discussed in the phone call.

What percentage should I offer to settle debt?

Offer a specific dollar amount that is roughly 30% of your outstanding account balance. The lender will probably counter with a higher percentage or dollar amount. If anything above 50% is suggested, consider trying to settle with a different creditor or simply put the money in savings to help pay future monthly bills.

Can I pay original creditor instead of collection agency?

Even if a debt has passed into collections, you may still be able to pay your original creditor instead of the agency. Contact the creditor's customer service department. You may be able to explain your situation and negotiate a payment plan.

How much should I offer a debt collector?

Start by offering cents on every dollar you owe, say around 20 to 25 cents, then 50 cents on every dollar, then 75. The debt collector may still demand to collect the full amount that you owe, but in some cases they may also be willing to take a slightly lower amount that you propose.

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What to do when a debt collector calls?

More importantly, by knowing what to do and say when a debt collector calls, you can avoid making a mistake that could put you at legal or financial risk. First, you should decide if you want to talk to the collector. If so, be sure to keep a record of what you and the collector discuss.

How do debt collectors communicate with you?

The Consumer Financial Protection Bureau issued a final rule amending Regulation F, which implements the FDCPA, to clarify how collectors may use texts, emails, and use other forms of digital communication, like social media, to contact you.

What does the FDCPA rule cover?

The rule explains how the FDCPA's protections apply to digital communications and gives consumers the ability to unsubscribe from debt collectors' electronic messages. It also describes how collectors may use voicemails and limits how often debt collectors can call you.

What happens if a debt collector crosses the line?

If the debt that the collector is calling about is several years old, find out what your state's statute of limitations is for filing a lawsuit to collect the debt.

What to do if you can't afford to pay a debt?

But if you decide not to talk to the collector, send a written request that the collector cease communication with you.

How to deal with aggressive debt collectors?

If you need help dealing with an aggressive debt collector, figuring out what option is best for handling your debts, negotiating a settlement, or responding to a lawsuit for nonpayment of a debt, consider consulting with a lawyer. Once you've hired a lawyer, under the FDCPA, a collector must talk to your attorney only—not you—unless you give permission to contact you or your lawyer doesn't respond to the collection agency's communications.

What is a collection log?

A collections log is a written record that you make of the date and time that a collector calls, the person you speak with, and what the collector says to you. Your log doesn't have to be anything fancy—writing it on a notepad or spare piece of paper is fine, or keeping a log using your computer or phone works too. A collections log will help you straighten out who is calling you from where, and what debts each collector is calling about. It will also help you keep track of how often a particular collector calls and document inconsistencies in what collectors say to you from one call to the next.

What are debt collectors required to provide?

Debt collectors are required to provide you with: The amount of the debt, which may include: o Accrued interest. o Late charges. o Collection costs. The name of the creditor. Information on obtaining the name of the original creditor (if different from the current creditor)

What does a debt collector do?

The debt collector can help you understand if the debt is your responsibility and explain your options. You can also ask questions. Being contacted by a debt collector can be overwhelming. Whether you know it’s your debt or are not sure if it’s yours, there’s information debt collectors are required to provide and there is additional information ...

What is the statute of limitations for a debt collector?

The statute of limitations or the limited period of time a creditor or collector has to file a lawsuit to recover a debt. Possible repayment or settlement options. In some cases, you may be able to settle the debt for less than what you owe.

How long does it take for a debt collector to contact you?

The debt collector is required to provide this information when the debt collector first contacts you, or in writing within five days of the initial communication. There is additional information that you can ask for over the phone or in writing that is not required to be provided by the debt collector. This information could include:

What happens if you don't speak to a debt collector?

If you choose not to speak with a debt collector over the phone or in writing about a debt, collection activity can still take place. You continue to run the risk of fees and finance charges, as well as being sued or the debt being reported as delinquent to the credit reporting companies .

What to do if you don't owe a debt?

If it is NOT your debt or you have already paid it, you can explain that. Providing documentation or other information that you paid the debt or don’t owe it may help. You can also notify the debt collector in writing to stop communicating with you.

How to stop debt collectors from calling?

Here are some common reasons to seek legal advice: 1 Debt collectors are calling you at home or work all the time. If you’re getting a lot of calls and can’t stop them with a request that the debt collectors desist, it might be time to bring in an attorney who can discuss your rights and speak to the creditors contacting you. 2 You’ve reviewed your finances with the help of a nonprofit debt counselor and have concluded that you are unable to repay your loans. 3 A creditor is threatening you with a lawsuit or has filed suit. 4 Debt collectors are treating you in a way that you feel is abusive. 5 Your creditor has repossessed your car and might be threatening you with a collection suit.

Why do people need debt lawyers?

Those people are seeking help from debt lawyers to fight back against aggressive debt collectors in court. If a debt collector is relentless in trying to recover money you owe, a debt lawyer is a good resource to help you understand your rights and provide a path to escape harassment or illegal tactics.

What does it mean when a creditor threatens you?

A creditor is threatening you with a lawsuit or has filed suit. Debt collectors are treating you in a way that you feel is abusive. Your creditor has repossessed your car and might be threatening you with a collection suit.

What do debt attorneys do in bankruptcy?

With a bankruptcy, a debt attorney will help you prepare all the required paperwork you need in your case. They can answer your questions and give you a basic rundown on rules and procedures in the courtroom.

Why are debt lawyers so popular?

Debt lawyers have become more prominent because household debt in the U.S. has jumped 11% over the last decade to an average of $134,643 (including mortgages) and credit card and auto loan debt are going over the $1 trillion, mark.

What happens if you don't pay a judgment?

If you don’t do either – and that is what happens in most cases – the creditor obtain a legal judgment against you and can pursue that until you finish paying it. Before deciding whether to hire a lawyer, defend yourself or let the creditor collect on a judgment, review the situation.

What is debt lawyer?

A debt lawyer is someone with the knowledge, credentials and skill to help consumers struggling with debt sort through their financial troubles. Representing clients in cases against debt collectors is a form of consumer law, the branch dedicated to protecting consumers against unfair trade and credit practices.

What happens if a collector gets a judgment against you?

Once the collector gets a money judgment against you, you might face wage garnishment, a bank account levy, or a lien on your property.

What is a debt collection lawsuit?

A debt collection lawsuit begins when the collection agency files a “complaint” (sometimes called a “petition”) in court. The complaint will explain why the collector is suing you and what it wants—usually, repayment of money you owe, plus interest, fees, and costs.

What is discovery in a lawsuit?

“ Discovery ” refers to the formal procedures that parties in a lawsuit use to get information and documents from each other to prepare for trial or settle the case. If you don’t raise any defenses or counterclaims, the collector probably won’t engage in discovery. But if you have a good defense or file a counterclaim, you and the collector might want to participate in discovery.

How long does it take to file a lawsuit?

Generally, you’ll get around 20 to 30 days to file a written answer to the lawsuit with the court. You’ll have to respond to the allegations in the complaint and raise any defenses you have, like that the statute of limitations (the law that sets a time limit on the right to file a lawsuit) has expired, or counterclaims against the collector, such as violations of the Fair Debt Collection Practices Act.

What happens if you don't respond to a collection?

If you don’t respond to the suit, the collector will most likely ask the court to enter a default judgment, which means you automatically lose the case. The court might then simply award the collector the amount it requested, or it might scrutinize the documentation to make sure the amount is legitimate, or the court might require the collector to present evidence before awarding any money. The collector will probably be able to get attorneys’ fees, court costs, and interest in addition to the amount you owe. Once the collector gets a money judgment against you, you might face wage garnishment, a bank account levy, or a lien on your property.

How to challenge summary judgment?

To challenge a summary judgment motion, you’ll have to file paperwork opposing the motion. If you don’t, you’ll probably lose. Because the outcome of the lawsuit is at stake, you should seriously consider consulting with a lawyer, if you haven't already, if the collector files this kind of motion.

What happens if a collector files a summary judgment?

If the judge grants the motion, the court will enter a judgment against you without a trial.

What is the right to know about debt collection?

2. Right to know the debt collector or debt collection agency. Under the FDCPA, debt collectors are required to identify themselves when they attempt to collect a debt as well as note that any information you give them will be used in an attempt to collect the debt.

How long does it take to get a debt collector to contact you?

The FDCPA states that debt collectors must provide the following information in writing within five days of first contacting you: The amount of the debt. The name of the creditor you owe. That you can dispute the debt.

What is the Fair Debt Collection Practices Act?

The Fair Debt Collection Practices Act, or FDCPA, gives consumers protections at the federal level, and most states also have laws about debt collection practices. Knowing your rights can be empowering.

What happens if you ignore a summons?

Depending on the laws of your state, if you ignore a summons — even if you believe the debt is too old — the debt collector may get a judgment to go after your assets or garnish your wages.

How long do you have to dispute a debt?

If you believe the debt being collected is inaccurate, you have 30 days from the date you’re first contacted by a debt collector to dispute the debt in writing. You should dispute anything you think may be inaccurate right away — after 30 days, the debt collector can legally attempt to collect the debt.

How to dispute incorrect debt?

Right to dispute incorrect debt. Steps to take to pay off debt in collections. 1. Right to a written notice explaining your debt. The first thing you should do when a debt collector contacts you — before even considering a payment — is to make sure that the debt collector and the debt are legitimate.

How long does it take to get the creditor's name and address?

The name and address of the original creditor (if different than the current creditor) as long as you request the information in writing within 30 days. There are two exceptions to this five-day deadline — if the information is contained in the initial written communication or you’ve paid the debt already. 2.

What Should I Expect When Working with a Debt Collection Attorney?

If you are a creditor, an attorney can help you put a plan in place to gain back the money you loaned out. Should you go to court, the timeframe and the amount you get will depend on the judge’s ruling. If you’re able to settle outside of court, you and the debtor will be able to negotiate terms.

What does a debt collection attorney do?

A debt collection attorney can represent you if you’re a creditor or a debtor. A lawyer can help come up with strategies either to get back money that you’ve loaned out or to protect yourself from overeager creditors. Your attorney can handle paperwork for you or represent you in court.

How Much Does a Debt Collection Attorney Cost?

Attorneys use different methods of billing, so there’s no straight answer to this. Many debt collection attorneys charge an hourly rate. Other charge based on a contingency, meaning you will not have to pay anything up front but your lawyer will take a percentage if you win your case. If you don’t win, your lawyer won’t receive any payment. If your lawyer decides to charge in this way, you’re likely on the creditor side because you have more to gain than if you were on the debtor side. Discuss how your lawyer bills up front, so that you can both agree on a fee you’re comfortable with.

What to do if you are not paying your debt?

If you need repayment for a debt and the debtor isn’t paying up, a debt collection attorney can help figure out your best course of action to get your money back. You may also want to consider a creditors rights attorney, who works solely for creditors to help them regain their money.

Why do lawyers charge on the creditor side?

If your lawyer decides to charge in this way, you’re likely on the creditor side because you have more to gain than if you were on the debtor side. Discuss how your lawyer bills up front, so that you can both agree on a fee you’re comfortable with.

What is debt settlement?

An inability to pay back loans at the present time. Threat of lawsuit from a creditor. Being treated unfairly by collectors. You may also want to consider a debt settlement attorney who can help reduce or eliminate loans in order to avoid debt collectors.

Do creditors hate hearing from collectors?

What you'll learn: Debtors dread hearing from collectors looking for money, and creditors hate when those in debt dodge their phone calls. If you’re in either situation, you may help from a legal professional.

What would happen if people just got some good legal advice about handling the suit rather than doing nothing?

If people just got some good legal advice about handling the suit rather than doing nothing there would be significantly fewer consumers facing judgments and wage garnishments after losing in court by default.

What percentage of consumers sued never show up for court?

But what is really happening is about 90 percent of consumers sued just never show up for court so they lose by default when they could have easily won and had the debt completely eliminated. Those folks are throwing away a perfectly good opportunity to make a debt go away because they are scared. If you have an old debt ...

Can you enforce a debt that has been turned over to a new company?

I've also watched debt buyers go after consumers long after the statute of limitations has expired and the debt cannot be legally enforced.

Do debt buyers have proof of debt?

The reality is most debt buyers just don't have the proof they need and so they will drop the case and stop trying to collect on that old unenforceable debt.

What is the best way to collect unpaid debt?

The most obvious choice to collect an unpaid debt is a collection agency. Agencies come in all sizes — some are local, some specialize in handling certain kinds of debts, and others are national in scope.

What to do if your letter has failed to resolve a debt issue?

If your letter writing, personal meetings, and phone calls have all failed to resolve a debt issue, it’s time to call in a professional — a debt collection agency or a lawyer specializing in debt collection. The most obvious choice to collect an unpaid debt is a collection agency.

What is a collection agency?

A collection agency will take many of the same actions against the debtor that you have probably taken. Third-party collectors are aided by specialized phone systems, computers, and software designed to automate the process and make it more effective and cost-efficient in retrieving payment on delinquent accounts.

Is it cheaper to hire a lawyer or a collection agency?

Most companies refer debt to a collection agency first and then turn to an attorney if the agency can’t do the job. While it might seem that a collection agency would be cheaper than hiring a lawyer, that’s not always the case. The price of a collecting a debt depends on the complexity and magnitude of the collection — sometimes debt can be ...

Do attorneys charge a fee?

Attorneys usually charge a minimum fee, or require the debt be of a minimum amount . Payment to the attorney will be in addition to any court-related fees and charges connected with a lawsuit, if you decide to pursue a judgment in court.

Is an attorney more effective than a collection agency?

They can be more effective than a collection agency, especially if the debt is serious enough to consider legal action. An attorney may charge an hourly fee, collect at least one-third of the amount recovered, or both. Attorneys usually charge a minimum fee, or require the debt be of a minimum amount. Payment to the attorney will be in addition ...

What is debt settlement lawyer?

Debt settlement lawyers can command a small fortune for their services, whether they work on contingency (meaning they take a cut of the debt savings they negotiate for you) or charge a specific hourly or per-case rate.

What happens if you owe $20,000?

2. Your wages are at risk of being garnished. In some cases, your creditors can come after your earnings if your debt goes unpaid for too long. For example, if you owe the IRS back taxes, ...

How long does bankruptcy stay on your record?

Not only is it expensive, but it can stay on your record for seven years in the case of a Chapter 13 filing, or 10 years in the case of Chapter 7.

Does Motley Fool have a disclosure policy?

The Motley Fool has a disclosure policy.

Can creditors sue you for a owed money?

Just as consumers have legal protections, so do creditors who are owed money, which means that in some cases, your creditors may have the right to initiate a lawsuit against you. At that point, bringing an attorney on board often makes sense, especially if there's a chance a serious judgement will be issued against you.

Can creditors come after you?

In some cases, your creditors can come after your earnings if your debt goes unpaid for too long. For example, if you owe the IRS back taxes, or if you're delinquent on your loans, you could be at risk of having your wages garnished, compounding your financial troubles. If that's the situation you're facing, then it might pay to hire an attorney to step in.