Prohibited Tactics Of Collectors Legally

The Fair Debt Collection Act specifies the rights of both creditors and debtors. If you have been subjected to any of the actions noted below, you are the victim of creditor harassment per the FDCA regulations. Collectors are prohibited from -

• Calling before 8 am or after 9 pm or constantly using the telephone to harass you.

• Depositing a post-dated check prematurely.

• Using profane language.

• Giving false information of any type concerning your account to anyone else.

• Stating they are attorneys or work for one of the credit bureaus.

• Suggesting or implying that you have committed a crime.

• Telling you that you owe more than your true debt balance.

• Labeling forms or letters sent to you as though were from a court or government agency.

• Convincing you to pay amounts greater or less than debt amount in settlement of the balance.

• Threatening to take your property (without a legal foreclosure process).

• Attempting to contact you via postcard or with transparent envelopes.

Remember, your creditors are also protected under the Act and have debt collection rights to take all legal actions available to collect the balance you owe them.

Easiest Way to Access Bankruptcy Records

Bankruptcy records are quite easy to obtain. One of the simplest sources is the Bankruptcy Voice Case Information System (VCIS), which allows you to call (free) this bankruptcy court automated phone line with a case number, name or social security number to receive the related bankruptcy record data. Should you need more detailed information, you could access (for a charge) the federal bankruptcy court’s electronic service center called PACER. This database will give you appellate court records also. To use this service go to www.pacer.psc.uscourts.gov. To easily access recent bankruptcy filings by businesses you could try bankruptcydata.com.

How To Build Credit After Bankruptcy

How do you build back your credit after you file bankruptcy? The short answer: Any way you can. The easiest methods:

• Procure one or two secured credit cards requiring a deposit equal to the credit limit issued (usually $300-400). Charge some small stuff and make minimum payments on time.
• Take $400-500 and get a savings account loan from a bank or credit union. Make all required payments on time.
• Get an auto loan, possibly directly from a dealer who wants to sell cars, and ensure that the lender reports to the credit bureaus. Make all payments on time.

Getting A Mortgage After Bankruptcy

You will be able to obtain a mortgage after bankruptcy but you will have to wait a while. The usual time period for a reasonably priced mortgage is two years from discharge. Occasionally, an aggressive lender may offer a product that allows for a shorter time period from discharge, although the terms will probably not be among the best. Also, in times of rising interest rates or “tight money” periods, there will be no such choices. Another option, if you can find it, is seller financing. The seller of a home, in order to facilitate its sale or who does not have a better source of investment for the sale proceeds, may be agreeable to financing the property him/herself. They will receive earnings (through the interest rate) while still having excellent security (their former property.)

An After Bankruptcy Credit Card

You may apply for an after bankruptcy credit card as soon as you receive your discharge from the bankruptcy court. These cards are either totally or partially “secured” by your own funds. You will make a deposit with the card issuer for an agreed-upon amount, usually around $300-400, after which you will receive a major credit card, VISA or MasterCard, with a credit limit equal to or slightly higher than your deposit amount. If you make all required payments on time for 6-12 months, your credit limit will normally be increased, giving you more unsecured credit. While the interest rate is quite high and some of your funds are more or less “frozen”, this is a perfect way to quickly reestablish your credit after bankruptcy.

Available Loans After Bankruptcy

There are some sources of loans after bankruptcy although your choices will be rather limited. Right after you receive your discharge, you can procure one or more secured credit cards from a number of card issuers. After you deposit an agreed-upon sum, usually $300-400, you will receive a major credit card, VISA or MasterCard, with a credit limit equal to or slightly higher than your deposit. As you make your scheduled payments in the coming months, your credit limit will normally be increased at regular intervals.

You should also be eligible for an auto loan since it will be secured by the vehicle. Many auto dealers will "self-finance" their own vehicles for you, even right after your discharge. Since these autos are their own inventory, they can afford to finance the purchase and generate continuing income from interest earned. If you have a bank account, you can also obtain a savings secured loan by pledging all or part of your balance. This is a very inexpensive loan (interest rate usually only about 2% above your savings rate) and, while technically not providing you with new cash, it will quickly help you reestablish your credit after bankruptcy.

Benefits of Bankruptcy

Declaring bankruptcy should never be considered a cure for all financial ills. It is a potential course of action that might prove to be beneficial when a person or company becomes enmeshed in a high debt situation combined with an inability to pay these debts. Should you declare bankruptcy, you will be given a fresh start, in a financial sense, but there are consequences. The report of the bankruptcy will stay on your credit file for up to ten years. Your bankruptcy is a public record and not protected by privacy laws. Should similar problems reoccur, you will be prohibited from seeking bankruptcy protection until eight years have passed since your prior discharge.

Debts That Cannot Be Discharged in a Divorce Bankruptcy

The following are debts that cannot be discharged in any bankruptcy, including a divorce bankruptcy.

• Child support.

• Alimony.

• Most obligations in the property settlement agreement.

• Student loans.

• Criminal restitution for fraud or crimes of violence.

Obligations in a property settlement agreement are sometimes dischargeable depending on the nature of the debt and the situations of the ex-spouses.

What Is Chapter 11 Bankruptcy?

Chapter 11 petitions apply to the reorganization of a business that is unable to meet its debt obligations with its projected income . Unlike a Chapter 7 bankruptcy filing which specifies a liquidation of assets, Chapter 11 is focused on designing a way for the business to avoid liquidating its assets. The debtor designs a plan that will protect the company from their former creditors and continue operating, while coming to an agreement to pay off old debts over time. Therefore, a Chapter 11 bankruptcy is much more like a personal Chapter 13 petition, which provides a plan for the individual to pay his/her creditors an agreed amount over a specified time period.

Are You Being Illegally Harassed

It is unlikely that you will become an “expert” in all the provisions of the Fair Debt Collection Act or the many variations of debt collection harassment. But you should become familiar with the most common violations committed by collectors:

• Calling before 8:00 am or after 9:00 pm;

• Contacting you at work after they have been advised not to;

• Contacting your friends or family and giving them information about your account;

• Threatening to take your home or evict you immediately.

There are also collection tactics and threats that are less common and overlooked by potential victims. Below is a partial list of these practices, which are classified as violating both the spirit and the letter of the law.

A creditor or 3^rd party collection firm is prohibited from:

• Threatening arrest or imprisonment for a criminal act because you have late payments on a debt;

• Contacting the Department of Homeland Security about your citizen/alien status;

• Selling your account to another company (which they often also own) just prior to being barred from collecting because time has run out for the purpose of continuing collection activities;

• Threatening to call you "everyday until your account is paid in full;"

• Reporting your vehicle as a "stolen" car because you missed one or more of your auto loan payments;

• Filing (or even threatening to file) criminal NSF (not sufficient funds) charges against you for a post dated check that the collection agency asked you to send to them;

• Representing himself/herself as an attorney when, in fact, he/she is not;

• Making any threats targeted or phrased to “demoralize, degrade, embarrass, humiliate, or intimidate” you into making payments on your debt.

Finally, even if you become knowledgeable, you should know that the Fair Debt Collection Act subscribes to the “ Least Sophisticated Consumer Standard” for judging potential violations. This means that, even though you would never believe one or more of the threats noted above, if the court believes that anyone (not everyone) anywhere might believe that they could be arrested and jailed for having late payments on a $325.00 credit card balance, you have an excellent chance of winning a suit against an over aggressive collector.