Know Your Rights

Did you know that as a consumer, you have certain rights in regards to debt collection? It doesn't matter if that debt is on a credit card, utility bill or even your home. If your payments are behind and the wolves are closing in, there are laws that help protect you. The Federal Fair Debt Collection Practices Act makes sure that lenders and collectors do not ruin your life or your reputation while trying to collect on a debt.

Of course, some collectors may not be aware of the Federal Fair Debt Collection Act. In addition, some people will always think they can "get away" with ignoring it. As long as you don't know your legal rights, they can. However, the instant you enforce your rights, you've made an important step in taking control of your life back.

The Federal Fair Debt Collection Practices Act has a couple of different sections. It restricts what lenders and collectors can tell other people when looking for you. It also limits how far lenders and collectors can go in nagging you about your debt.

Section 804 deals with what lenders and collectors can tell other people about you. If a debt collector is speaking with someone other than the consumer (i.e. a boss or a relative) in order to get contact or location information, the debt collector must:

Identify him or herself by name, state that he or she is confirming or correcting location or contact information concerning the consumer and, if specifically requested, must identify the employer of the caller.

Fail to state that the consumer owes any debt. A collector can't call your employer and say "Oh, yes, his house is about to go into foreclosure and we're trying to collect." That's a breach of your privacy.

Fail to communicate with a person other than the consumer more than once unless requested to do so by that person or if the debt collector believes that the original information provided by that person is erroneous or incomplete and the person now has correct or complete contact or location information. In other words, a collector can't harass your mother, your ex-spouse or your friends in order to frighten them into providing information.

Fail to communicate by post card. They can't send public mail around looking for you.

Fail to use any language or symbol on any envelope or in the contents of any communication by mail or telegram that indicates the debt collector is in the debt collection business or that the communication relates to the collection of a debt. They can't send mail out to your friends, relatives and associates about your personal financial straits.

If the debt collector knows the consumer is represented by an attorney in regard to the debt and knows or can readily find out the attorney's name and address, the debt collector can only contact the attorney unless the attorney fails to respond to a communication from the collector within a reasonable period of time. In other words, if you retain the services of an attorney, the collector must speak only with that attorney and cannot contact you or anyone else.

Sections 805 and 806 address how lenders and collectors have to deal with you, the consumer. Section 805 states, quite simply, that if you notify a debt collector in writing that you refuse to pay a debt or you want the debt collector to quit trying to communicate with you, the debt collector will leave you personally alone in regards to the debt with the sole exception of notifying you that they won't try and collect any more.

Realize that this does not protect you from prosecution or foreclosure. Those are still legal options open to the lender or collector. It does mean that they won't try and use other methods first.

Section 806 is a lot more comprehensive and lays down the rules of "fair engagement" so to speak. If you haven't told them to leave you alone in writing, there are still limits on how far they can go to collect from you.

A debt collector can't do anything whereby the natural consequence is to harass, oppress or abuse anyone in connection with debt collection. While the following list is not comprehensive, it does cover some of the more common offenses.

When speaking with a consumer, the debt collector cannot:

Use or threaten violence or other criminal means to harm the physical person, reputation or property of any person. They can't threaten to ruin your career, they can't threaten to harm your house or wreck your credit, and they certainly can't personally threaten you.

Use obscene or profane language or language that abuses the hearer or reader. No insults, no profanities, and no deliberate put-downs are allowed.

Publish a list of consumers who supposedly won't pay their debts except to a consumer reporting agency (credit reporting agency) or to people who are authorized to get such a list. Authorized people may include law enforcement personnel, judges and people who you give permission to in writing.

Advertise the sale of a debt for the purpose of getting the consumer to pay the debt. They can't publicize the sale of your foreclosure in your hometown to embarrass you into paying.

Call repeatedly either just to make the telephone ring off the hook or to repeatedly engage you or anyone else in telephone conversation with the intent to annoy, abuse, or harass anyone at the number called. They can't call you over and over and over again. The normal standard is once a day during reasonable business hours, but that may vary per state.

Call you without telling you their names, employer's names and reason for calling. They can't tell other people about your debt, but they must provide you with the full details once they've made sure they're talking to the right person.

In addition to these federal laws, each state also has laws governing debt collection and foreclosure. A good loss mitigation expert can help you use these laws to their fullest advantage and avoid home foreclosure entirely.

A foreclosure usually takes quite a bit of time to go through. While the laws in each state are different, most people can stop foreclosure but only if they start in time. Three days before the final judge's gavel falls is not enough time.

However, if you start looking the moment you know you're in trouble, there's a lot you can do. Foreclosure laws are usually very complicated. They take time to understand, time you may not have. A loss mitigation expert has devoted considerable time already to understanding those laws.

In addition, while getting a new loan may be the quickest way out of a foreclosure, getting that loan can be costly or even impossible if your credit is less than stellar. Renegotiating with your current lender will often cost you less, but you have to know what you're doing and how the real estate market works to negotiate well. That's where the Loan Modification Toolbox comes in. We give you the step-by-step roadmap to loan modification that will stop your foreclosure and create a mortgage you can handle for thousands less than hiring an expert.

If you're facing foreclosure, don't wait till the last minute. The middle of a foreclosure doesn't leave you time to pore over law libraries and real estate reports. Contact us today and get the Loan Modification Toolbox you need to save your home, fast.