Dealing with Debt
Learn about common debt problems, including filing for bankruptcy .
A debt collector by and large is a person or caller that regularly collects debts owed to others, normally when those debts are past-due. This includes collection agencies, lawyers who collect debts as part of their business, and companies that buy delinquent debts and then try to collect them. The Fair Debt Collection Practices Act ( FDCPA ) prohibits debt collectors from using abusive, unfair, or deceptive practices to collect from you .
What Types of Debts Are Covered?
The Act covers personal, syndicate, and family debts. This includes money owed on personal recognition poster accounts, car loans, checkup bills, and mortgages. The FDCPA does not cover debts incurred in running a occupation .
What Happens After a Debt Collector Contacts You?
Within five days after a debt collector inaugural contacts you, the collector must send you a written notice that tells you the name of the creditor, how much you owe, and what carry through to take if you believe you do not owe the money. If you owe the money or separate of it, contact the creditor to arrange for payment. If you believe you do not owe the money, contact the creditor in compose and send a copy to the collection representation informing them with a letter not to contact you.
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What Practices Are Off Limits for Debt Collectors?
A debt collector may not :
- Contact you at inconvenient times, for example, before 8 AM or after 9 PM, unless you agree to it.
- Communicate with you at work if you tell the debt collector your employer disapproves.
- Contact you after you send a letter to the collector telling them to stop, except to notify you if the creditor or collector plans to take a specific action.
- Communicate with your friends, relatives, employer, or others except to find out where you live or work.
- Harass you with repeated phone calls, profane language, or threats to harm you.
- Make any false claim or statement that you will be arrested.
- Threaten to have money deducted from your paycheck or to sue you, unless the collection agency or creditor intends to do so and it is legal.
File a Complaint About a Debt Collector
Report any problems you have with a debt collection company to your State Attorney General ‘s Office, the Federal Trade Commission ( FTC ), and the Consumer Financial Protection Bureau ( CFPB ). many states have their own debt collection laws that are different from the federal Fair Debt Collection Practices Act. Your country Attorney General ’ mho office can help you find out your rights under your state ’ mho police .
If you ‘re ineffective to pay your creditors, filing for bankruptcy can help you get a fresh begin. Bankruptcy involves liquidating or selling off your assets to pay your debts. Or it can mean creating a payment plan. Before considering bankruptcy, you should first explore other debt management options. Bankruptcy information stays on a credit composition for 10 years. It can besides make it difficult to get credit, buy a home, get life insurance, or sometimes get a job .
Learn About the Types of Personal Bankruptcy
federal courts have jurisdiction over all bankruptcy laws, so you must file a petition in a union bankruptcy court. There are two chief types of personal bankruptcy :
- Chapter 13 lets people with a steady income keep their property. This bankruptcy plan allows filers to keep a mortgaged house or car they might otherwise lose in the bankruptcy process.
- Chapter 7 is known as straight bankruptcy. It involves liquidating all assets that are not exempt under federal or state law.
File for Bankruptcy
The Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 established rigorous rules. These rules apply to both consumers and attorneys. To file for bankruptcy, you ‘ll need to :
- File documents. This includes itemized statements of monthly net income and proof of income (pay stubs) for the last 60 days. Also, you should include tax returns for the preceding year (four years for Chapter 13 bankruptcies). Find out how to get a copy or transcript of your tax return.
- Take a pre-filing credit counseling and post-filing education course to have debts discharged. Find an approved credit counseling agency through the U.S. Trustee Program.
- Pay filing fees, plus fees for credit counseling and education.
The bankruptcy and prayer process is complicated, so it can be unmanageable to file without an lawyer. lawyer fees are supernumerary and deviate .
Report Bankruptcy Fraud or Abuse
You can file a fraud report with the U.S. trustee Program at the Department of Justice ( DOJ ) .
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last Updated : May 6, 2022