Know the tactics of the collection agencies use for debt collection

Bankruptcy Help — Thu, 30 Apr 2009 16:31:30 +0000

Debt is not confined to poor and middle class but any one can find them in financial debt. There are many reasons that can lead to debt such as death of a family member, divorce, sudden job loss and an unprofitable business venture.
Credit score is being the most important for an American, and this has been the most effective weapon for the collection agencies. Spoiling your credit report with account in collection will lower your credit score. Individuals with low credit score will find hard to find finance as the lender sees the risk of lending to those individual is higher.
With economic crisis around the world and its impacts in our lives, debt is piling up. Under such circumstances debt collection agencies have to tighter their rules to collect the debt. Due to this we have been seeing rise in the abuse of Fair debt collection practice Act. This act protects every consumer form unlawful debt collection tactics. Here are some of the tactics that collection agencies use for debt collection.
Pre approved offer for credit: it looks like a new credit offer with pre approved streaked across the front page but as you continue to read you may realize that this is not serious credit offer in turn an offer to put your old debt on any company new credit card. This is one of the collection agencies tactics for debt collection. Unfortunately if you had accepted that offer and signed on it you unintentionally showed the proof of having debt and almost have to pay three times more than what you owe before. It is better to consult an attorney, specialized in consumer law if you are not sure of the details of the agreement.
Two for one: it is the case where two collection agencies are trying to collect the same debt at the same time. It is illegal to collect in such a way, but they are doing so because of the fact you don’t know the law. If you received more than one letter from collection agencies with different name for the same debt, then you dispute them by asking in writing simultaneously to all the collection agencies that send you a letter to show the proof that they own and can collect the debt on the account. But remember not to mention name of the other collection agencies from which you receive the letter to prevent clouding.
The posers: you may receive a letter from which looks like a reputable law firm offering you help in resolving your debt. It doesn’t look like a letter from collection agencies so that you call and fix an appointment with that company. They pretend to study your case and paperwork and in the end they say, paying the debt is the only way for you. If they say so kindly leave, chances are that they are linked to debt collection agencies.
The fair credit reporting act, fair debt collection act were enacted by the US government to offer consumer relief from debt in dreadful times. Every tactic which was listed above was unethical and illegal but is still in use because of uninformed consumers and they collect millions of dollars. Above tactics can keep you credit score low for years.

No related posts.

How to Choose a Bankruptcy Attorney

Bankruptcy Help — Fri, 06 Mar 2009 10:26:10 +0000

The decision to declare bankruptcy is often a serious one and the last resort of consumers that are facing severe financial hardship and find themselves unable to make the monthly minimum obligations to their debt on the income that they have available. Throughout the process of bankruptcy there is one person that is responsible for filing papers and giving advice to clients. A bankruptcy attorney is an essential part of the process of filing for bankruptcy and should be chosen with care.

When choosing a bankruptcy attorney, keep the following aspects in mind:

Experience

Choosing a bankruptcy attorney with experience is an essential part of ensuring the best decisions are made throughout the entire process. During the initial consultation be sure to ask about the experience the bankruptcy attorney has and the cases that they have worked on in the past.

The internet is a valuable tool for finding information about any claims that may have been filed against the bankruptcy attorney as well as to find information about the firm the bankruptcy attorney works with. It is important to determine if the bankruptcy lawyer will be working as part of a team on the case, or working alone. If the attorney is working as part of a team than it could be beneficial to meet with members of the team that will be working on the case. Once the professionals are familiar with your case it can create a personalized experience that will yield the best results.

Services

What services are included with the fees that are charged by the bankruptcy attorney? If there are services required above and beyond the contract, what types of fees will be charged for these services? It is important to determine all services that are included with the filing of personal bankruptcy.

Fees

What fees are associated with the process of declaring bankruptcy? Depending on the bankruptcy processes that are being taken and experience of the bankruptcy attorney – fees will vary between attorneys. Be sure to discuss the fees in the beginning of the process before signing any contracts to ensure that you are able to afford the fees associated with declaring personal bankruptcy.

Be sure to determine with the bankruptcy attorney any extra fees that may come about through the process. There are some attorneys that will not charge extra for time and work that is incurred through the process, but each attorney differs in policy so it is important to make sure.

Upon meeting with the bankruptcy attorney it is important to develop a plan after presenting the information such as amounts owed to creditors. At this point, the bankruptcy attorney should be able to determine if bankruptcy is indeed the best avenue for the consumer. If not, the bankruptcy attorney can often point the consumer in another direction.

Depend on the rapport that has been developed with the bankruptcy attorney and determine if the plan is something that fits with your financial plan.