| |
| |
|
|
Debt Relief Information |
|
Debt Collectors; And what you can do to Get Them Out of your Life
FTC opinion letter on validation Section 809(a) of the FDCPA, 15 U.S.C. § 1692g(a) This will be a pretty long lesson and will cover an integral part of validation which is the receipt of the initial or first contact with the debtor by a collector which usually gets thrown in the trash can if the debtor has not the funds to pay. That is a very serious mistake. One should never throw those collection letters away. They may very well be a vital part of your defensive strategy later down the road. This lesson is taken from a part of an FTC opinion letter on validation and tells us what that first letter must contain at the very least, and what it must do and must not do so this is an important lesson indeed.. This course was originally designed for attorneys and was designed to teach them avoidance of problems. Naturally, we use their lessons against them and do all we can to get them to screw up so they can be sued. You will find a lot of ingenious tricks and traps can be devised to make them goof it up and lose their collection efforts and their cases against you. --------------------------------------------------------------- SECOND ISSUE: Where an attorney debt collector institutes legal proceedings against a debtor but has no prior communications with the debtor, are the requirements for the validation of debts set forth in Section 809 of the FDCPA supreme to state law or state court rules that otherwise prohibit the inclusion of the validation notice on court documents? In responding to this issue, the Commission notes first that Section 809(a) of the FDCPA, 15 U.S.C. § 1692g(a), provides: (a) Within five days after the initial communication with a consumer in connection with the collection of any debt, a debt collector shall, unless the following information is contained in the initial communication or the consumer has paid the debt, send the consumer a written notice containing - (1) the amount of the debt; (2) the name of the creditor to whom the debt is owed; (3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector; (4) a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and (5) a statement that, upon the consumer's written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor. Section 803 (2) of the FDCPA, 15 U.S.C. § 1692a(2), defines the term "communication" as "the conveying of information regarding a debt directly or indirectly to any person through any medium." In its Staff Commentary, Commission staff stated that the term "communication" "does not include formal legal action (e.g., filing of a lawsuit or other petition/pleadings with a court; service of a complaint or other legal papers in connection with a lawsuit, or activities directly related to such service) " 53 Fed. Reg. at 50101, comment 803 (2)-2. Similarly, in the introductory portion of the Staff Commentary, Commission staff opined that "Attorneys or law firms that engage in traditional debt collection activities (sending dunning letters, making collection calls to consumers) are covered by the FDCPA, but those whose practice is limited to legal activities are not covered." (3) Id. at 50,100. Seven years after the Staff Commentary was issued, the United States Supreme Court held that the FDCPA's definition of "debt collector," Section 803(6), 15 U.S.C. § 1692a(6), "applies to attorneys who 'regularly' engage in consumer-debt-collection activity, even when that activity consists of litigation." Heintz v. Jenkins, 514 U.S. 291, 299 (1995). In arriving at this conclusion, the Court explicitly considered and rejected Commission staff's introductory remark regarding the coverage of litigation attorneys. Id. at 298. In light of Heintz, the Commission concludes that, if an attorney debt collector serves on a consumer a court document "conveying information regarding a debt," that court document is a "communication" for purposes of the FDCPA. (4) If an attorney debt collector has had no prior communications with a consumer before serving a summons or other court document on the consumer, that document would constitute the "initial communication" with the consumer if it conveys information regarding a debt. The attorney would therefore have to include the written notice mandated by Section 809(a) (often referred to as the "validation notice") in the court document itself or send it to the consumer "within five days after the initial communication." According to the ACA's Request, some "state laws or state court rules prohibit the inclusion of additional language such as the validation notice on documents filed with courts." The association asks whether the requirements of Section 809(a) are "supreme to," and thus preempt, these state laws or state court rules. Id. Preemption cases generally proceed from "the starting presumption that Congress does not intend to supplant state laws." New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 654 (1995). (5) According to the Court in English v. General Electric Co., 496 U.S. 72 (1990): State law is pre-empted under the Supremacy Clause, U.S. Constitution Article VI, cl. 2, in three circumstances. First, Congress can define explicitly the extent to which its enactments pre-empt state law. Pre-emption fundamentally is a question of congressional intent, and when Congress has made its intent known through explicit statutory language, the courts' task is an easy one. Second, in the absence of explicit statutory language, state law is pre-empted where it regulates conduct in a field that Congress intended the Federal Government to occupy exclusively. Such an intent may be inferred from a "scheme of federal regulation . . . so pervasive as to make reasonable the inference that Congress left no room for the States to supplement it," or where an Act of Congress "touches a field in which the federal interest is so dominant that the federal system will be assumed to preclude enforcement of state laws on the same subject." . . . . Finally, state law is pre-empted to the extent that it actually conflicts with federal law. Thus, the Court has found pre-emption where it is impossible for a private party to comply with both state and federal requirements, or where state law "stands as an obstacle to the accomplishment and execution of the full purposes and objectives of Congress." Id. at 78-79 (omission in internal quotation in original) (citations omitted). The preemption provision of the FDCPA, Section 816, 15 U.S.C. § 1692n, provides: This title does not annul, alter, or affect, or exempt any person subject to the provisions of this title from complying with the laws of any State with respect to debt collection practices, except to the extent that those laws are inconsistent with any provision of this title, and then only to the extent of the inconsistency. For purposes of this section, a State law is not inconsistent with this title if the protection such law affords any consumer is greater than the protection provided by this title. The Commission does not believe that this section expressly preempts state laws and court rules that prohibit attorney debt collectors from including validation notices in court documents. The quoted provision makes express that Congress did not intend to preempt the field, but allowed only for conflict preemption. However, there is no conflict preemption here. First, there is no conflict preemption based on impossibility of compliance because it is possible for attorney debt collectors to comply with both the federal provision and the state provisions. (6) Instead of including such notices in court documents, attorney debt collectors in jurisdictions that prohibit validation notices in court documents may deliver the notices to consumers via some other medium -- either before serving the court document on the consumer or, if the court document is truly the first communication with the consumer, within five days of serving the court document. (7) Second, there is no conflict preemption based on state law standing as an obstacle to the full accomplishment and execution of Congressional purposes and objectives. As Congress declared in Section 802(e) of the FDCPA, 15 U.S.C. § 1692(e), the purpose of the panoply of protections under the federal debt collection statute is: to eliminate abusive debt collection practices by debt collectors, to insure that those debt collectors who refrain from using abusive debt collection practices are not competitively disadvantaged, and to promote consistent State action to protect consumers against debt collection abuses. The state provisions about which you inquire do not prevent consumers from receiving the full panoply of protections from abusive debt collection practices afforded by the FDCPA. The only FDCPA provision that could be affected by these state laws and court rules is Section 809(a). As noted above, an attorney debt collector who is prohibited from including the validation notice in court documents may deliver the notice to consumers before serving the consumer with the court document or, if the court document is the first communication with the consumer, within five days after serving the court document. Thus, even in a jurisdiction that prohibits validation notices in court documents, a consumer will receive the validation notice and learn, for example, that the debt collector must provide the consumer with written verification of the debt if the consumer disputes the debt within thirty days. State legislation that prohibits validation notices in court documents also does not stand as an obstacle to the promotion of "consistent State action to protect consumers against debt collection abuses." Consumers will receive their validation notices in jurisdictions that prohibit validation notices in court documents as well as in jurisdictions that permit the practice. After reviewing state laws and court rules that prohibit validation notices in court documents under a preemption analysis, the Commission concludes that such state legislation is not preempted by the FDCPA. By direction of the Commission. Donald S. Clark Secretary Endnotes 1. Section 809(b), 15 U.S.C. § 1692g(b), provides: If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector. 2. In the Staff Commentary on the Fair Debt Collection Practices Act, 53 Fed. Reg. 50097 (1988) ("Staff Commentary"), and staff opinion letters, Commission staff have consistently read Section 809(b) to permit a debt collector to continue to make demands for payment or take legal action within the thirty-day period. See 53 Fed. Reg. at 50,109, comment 809(b)-1 ("A debt collector need not cease normal collection activities within the consumer's 30-day period to give notice of a dispute until he receives a notice from the consumer."); letter from John F. LeFevre, FDCPA Program Advisor, to S. Joshua Berger (May 29, 1997): We interpret the "thirty-day period" as a period within which consumers must dispute their debts in writing in order to avail themselves of their Section 809(b) rights, but not as a "grace" period. Thus, we believe that there is nothing in the Act that prevents you from filing suit during this period, so long as you do not make any representations that contradict Section 809(b). Kenneth M. DeLashmutt "Predatory Lending Defense Specialist" email: educationcenter2000@cox.net website: http://www.educationcenter2000.com Mr. Kenneth M. DeLashmutt is a recognized Predatory Lending Defense Specialist and an authority on the subject of predatory lending practices, foreclosure defense, consumer protection and debtor's rights. He has more than 10 years experience in the area of consumer protection related to predatory mortgage lending practices and debt resolution. He has provided regulatory consulting services nationwide to financial institutions, consumers and regulatory agencies as well as real-estate and financial services organizations. Areas of Expertise include: Banking Operations and Administration; Lending Policies and Laws to Protect Consumers, Mortgage Brokers and Mortgage Lender Predatory Lending Custom & Practice; Credit Administration; Bankruptcy and Foreclosures; Trust & Fiduciary Issues / Operations; Real Estate Transactions; Consumer Protection Litigation and Foreclosure Defense. email: educationcenter2000@cox.net website: http://www.educationcenter2000.com
MORE RESOURCES:
Debt-Relief - Google News |
|
|
|
RELATED ARTICLES
Debt Collectors: Men or Mice? Who are these people anyway? They viciously harass you and call you bad names. They embarrass you beyond belief by leaving detailed messages with your neighbors and at your workplace. Debt and Financial Optimism in the UK Continue With £1.3 trillion pounds worth of debt in the UK, Scotland's Citizens Advice Bureau has welcomed a new Bill to regulate lenders and protect borrowers from creating un-repayable levels of personal debt. New Bankruptcy Law - Five Essential Things to Know Last April, Congress passed the Bankruptcy Abuse and Consumer Protection Act, the most sweeping reform of our nation's bankruptcy laws in more than twenty-five years. Proponents of the bill argue that most consumers who file for bankruptcy do so simply because they do not wish to pay their bills. Bad Credit Home Loan To Get You Out Of Debt A "bad credit home loan" can help you climb your way out of debt and get you started back on the road to upstanding, good credit. There are many lenders who are willing to make bad credit home loans to you - a loan based on your equity in your home even if your credit has slipped or isn't as perfect as it could be. Debt Settlement -- Why the Critics Are Wrong After October 17, 2005, a lot of people are going to become interested in debt settlement as an alternative to bankruptcy. That's the date the new bankruptcy law goes into effect, and it means a rude awakening for many consumers seeking a fresh start in bankruptcy court. What Is A Chapter 13 Bankruptcy? Many consumers that are bogged down in debt frequently turn to bankruptcy as a form of restoring their financial status back to a zero balance. Unfortunately many of these same consumers are confused when it comes to the difference between a Chapter 13 bankruptcy and a Chapter 7 bankruptcy. Personal Bankruptcy - If Its Unavoidable, File Now The Bankruptcy Abuse and Consumer Protection Act, signed into law by President Bush last April, promises changes to Federal bankruptcy law that have been long sought by the lending industry. The bill promises sweeping changes to Federal law, and will make it much harder for the average consumer in financial trouble to have their debts wiped out by filing for bankruptcy. How To Avoid Medical Collections With medical collections costing doctors millions upon millions of dollars in unpaid bills and collection fees, many people have just one question: Who are these people who are trying to stiff the doctors who delivered them from great physical pain (or the flu, hypochondria, not-so-white-teeth, or a nose that didn't look enough like Brad Pitt's)?Well, I'm here to tell you who these people are, or at least some of them.They're me. Learn The Five Key Debt Reduction Steps You Must Take Immediately! Step 1. The purpose of this first step is to bring you back to reality. How to Protect Yourself: Debt Collections So you are getting collection calls? You're desk is full of unpaid bills. You dread answering the phone. Benefits and Drawbacks of Bankruptcy Outlined below are some of the benefits and drawbacks of bankruptcy. It should be noted that bankruptcy is not to be entered into without first having sought professional advice. The Human Side - Debt Stress In all the technical discussion you hear about credit card debt, the best ways to manage it and pay it off and all the rest, one thing goes largely ignored. Credit card debt is extremely stressful, and can have a very negative effect on your life, if you let it. Reduce Your Debt With These 5 Tips It's never pleasant to realize that you're in financial hot water, but pretending the situation doesn't exist is NEVER the way to deal with the problem. If you're having trouble meeting monthly payments, find yourself borrowing or using credit cards to meet daily expenses, or have one or more of your credit accounts turned over to a collection agency, it's time for you to get proactive and bring your debts back under control. Is There Any Way To Get Out Of Debt? In this era where we are bombarded daily with commercials on television, radio, billboards, through email, not to forget the flyers slipped under the car's wiper blades while shopping at the mall, it's no surprise that so many of us find ourselves endlessly in debt to the services and products offered by others. How can we refuse, when we're baited with the juicy orange carrot of '0% APR' up to a certain amount or for a specified time, or 'no money down' and 'easy installments' of just so much per month?Before we know it, we're in debt. Take Careful Consideration Before Filing Bankruptcy Filing bankruptcy is not fun! It is a last resort if you are interested in keeping an active and acceptable credit report. Bankruptcy is the condition of bringing all your assets and deficiencies into an insolvent state. Debt Negotiation and Debt Settlement Debt negotiation and settlement can give you a drastic reduction in the amount of debt you owe and allow you to repay your debts in a much shorter time. Resolving your debts is important to your well-being and financial stability. 5 Ways to Get Out of Debt It has been said that everyday more and more people in the world are getting into unsecured debt. Once reason for this is the relative ease in which credit card companies and banks are extending credit to their customers. Bankruptcy Abuse Bankruptcy is little more than a smack on the hand these days. Creditors are certainly not going to look at you as a wise credit risk after bankruptcy, but that will probably not stop them from extending credit to you anyways. Credit Repair? Its All Up to You Log onto to a search engine such as google.com and type in the term credit repair. Student Loans Can't Be Swept Away Through Bankruptcy Bankruptcy is in the news these days, as Congress has finally overhauled the Federal bankruptcy law after years of talking about it. The credit card companies, rightly or wrongly, have been pressuring members of Congress to tighten the bankruptcy statutes, saying that too many people were willfully spending money they couldn't repay with the intention of avoiding paying the money back by filing for bankruptcy.
|
||||||||||||||||||
