Eric Stephenson – Page 2 – Attorney Driven Credit Repair

Money Damages for Unfair Debt Collections

February 25, 2013 by Eric Stephenson

When a debt collector violates your rights by engaging in unfair debt collection practices you can sue it to stop the harassment or abuse and, in many cases, recover monetary damages from the abusive collector. Although debt relief is not an available remedy under the Fair Debt Collection Practices Act (FDCPA), four kinds of monetary damages may be available to consumers who successfully sue abusive debt collectors for unfair debt collections.

Statutory Damages for Unfair Debt Collection

Statutory damages are available in FDCPA unfair debt collection cases though the amount is limited to no more than $1000. That amount is the total available regardless of the amount of violations at issue. Although I cannot explain why the upper limit for statutory damages is so low, their purpose is to encourage consumers to sue debt collectors even when there are no actual damages. In awarding statutory damages the courts will consider the nature, frequency, and persistence of the noncompliance with the FDCPA and whether or not the collector intended to commit the acts that violated the FDCPA.

Actual Damages for Abusive Debt Collection

Actual damages may also be awarded in FDCPA litigation. Actual damages in unfair debt collection cases consist of monetary damages incurred as a result of the abusive collection activity. This can include attorney’s fees incurred to defend an improper debt collection lawsuit or other tangible monetary loss. Actual damages can also include damages for emotional harm or harm to your reputation. This includes sleeplessness, nausea, anxiety, embarrassment, shame, and depression caused by the unfair debt collection abuse.

Punitive Damages for Debt Collection Abuse

Punitive damages may be available in abusive or unfair debt collection litigation but are challenging to obtain. The reason is because several courts have refused to award punitive damages solely under the statute, despite the lack of evidence in the FDCPA that Congress meant to preclude punitive damages. The best practice is to include state law claims in your complaint that allow an award of punitive damages. To support an award of punitive damages, you will also need to demonstrate actual damages and that the collector acted with an unusually high level of malice or recklessness.

Attorney’s Fees for Debt Collection Abuse

Consumers who successfully sue under the FDCPA for abusive or unfair debt collection practices are entitled to a mandatory award of the attorney’s fees incurred in the action. This is a powerful incentive to hire an attorney rather than sue a collector on your own. Most consumer law attorneys will take these cases on a contingency basis so you will generally pay nothing if you lose your case. In addition to the value of this requirement in discussing settlement, there is also a great amount of personal satisfaction in making a debt collector pay your legal fees.

Debt Relief in Debt Collection Lawsuits

Relief for the underlying debt is not considered actual damages and therefore is not an available remedy under the FDCPA. This means that even if you successfully sue a collection agency you will still normally remain liable for the underlying debt. Even so, forgiveness of the debt is a viable option to consider when negotiating settlement of an FDCPA case. Doing so will prevent the collection agency from selling your debt to reignite collection efforts by someone else.

Conclusion

Many consumer law firms will tell you that there are only two kinds of damages available under the FDCPA for abusive or unfair debt collection practices; namely actual and statutory damages. This is because punitive damages are difficult to obtain and attorney’s fees are not strictly considered damages. Nonetheless, both are recoverable under the FDCPA and both should be pursued if your case merits doing so.

If you are a victim of unfair, undignified, or abusive debt collections please call us now to discuss how we can help. We can stop the calls and make abusive debt collectors pay you.

How to Sue Debt Collectors: Tricks and Traps

February 21, 2013 by Eric Stephenson

So you want to a sue debt collector? Suing debt collectors is not as easy as it sounds. There are numerous pitfalls and barriers that can trap unwary consumers.

The first issue to be concerned about when suing a debt collector or collection agency is whether or not you have a good case. Debt collectors frequently violate the law but many of those violations are merely technical and are not, by themselves, good legal claims. For example, debt collectors often fail to place the required “mini-Miranda” warning on written correspondence or fail to validate the debt at issue. While these acts are violations of the Fair Debt Collection Practices Act (FDCPA) and do give you the right to sue debt collectors they are not particularly compelling and unlikely to lead to a high damage award since there is little to no actual damage for the collector’s failure. Most consumer protection attorneys will not even take these types of cases due to the relatively low value compared with the high cost to litigate cases.

You also need to be sure you are suing a debt collector. The original creditor is generally not subject to the FDCPA and therefore can take many steps to collect debt that debt collectors cannot. There are laws to protect you from abuse by the original creditor but suing under those laws is more complicated and expensive than suing debt collectors under the Fair Debt Collection Practices Act.

Another trap is the bona fide error defense. Most, if not all, debt collectors will assert this defense like clockwork. It is generally asserted reflexively whether it actually applies or not but if the debt collector can prove its FDCPA violations were the result of a bona fide error it will not be held liable to you for those violations.

Another concern is that in many cases debt collectors will file counter-claims against you for the debt at issue. This is a powerful tactic and will keep many people from filing cases against debt collectors. Counter-claims may be difficult or impossible to overcome in many cases. There are ways to win on the counter-claim but unless the statute of limitations on the debt has run, the debt is fully repaid, or you never legally owed the debt in the first place you are likely to lose. Another problem with counter-claims is that the statute of limitations on an FDCPA case is only one year while the statute of limitations to collect the debt is almost always longer, depending on how old the debt is when the debt collection violations occurred.

There are numerous other issues to be aware of when suing debt collectors for unfair debt collection practices. To be certain you have a good case you should generally consult a consumer rights attorney. If you have a case worth filing they will typically take it on a contingency basis so you only pay if you recover an award and the fees you pay will come out of that reward. In addition to the probability of a higher award with an attorney representing you, there is also a tremendous amount of satisfaction in making an abusive debt collector pay for your attorney.

How to Restore Your Identity

February 18, 2013 by Eric Stephenson

If your identity has been stolen there are steps you can take to restore your identity, your credit, and your good name. There are also steps you can take to stop debt collectors and creditors from collecting debt that is the result of identity theft.

The first step to restore your identity is to contact the creditors and collection agencies and let them know the debt is the result of identity theft. Make this contact in writing and do not try this if you authorized the debt or received any benefit from the debt. Lying to get out of a debt that is legitimately yours could subject you to a criminal prosecution for perjury.

Your next step to restore your identity is to contact the credit bureaus and instruct them to cease any further reporting of the identity theft debt. Again, make this contact in writing and do not lie or seek to mislead the credit bureaus. You should also request a fraud alert to prevent any future thefts of your identity from occurring. Renew the fraud alert with the credit bureaus every 90 days for at least a year or request an extended fraud alert once you have fully prepared an identity theft report. You should also obtain your credit reports at least once each year just to be sure there isn’t other fraudulent activity taking place. In most cases, credit monitoring services are not worth the cost so stay away from them. Credit fraud alerts and personal diligence on your part in protecting your private information are generally sufficient to stop future identity theft from occurring.

In most cases, restoring your identity will require you to, among other things, complete an Identity Theft Affidavit and file a police report. Do both immediately and include these documents with your letters to the creditors, debt collectors, and credit bureaus.

Restoring your identity after a theft can be a time-consuming and difficult job. Taking these steps will help you restore your identity and protect your good name. They will even protect you from future theft. Take back control of your identity.