Good News for Consumers–the CFPB’s Proposed New Rules for Debt Collectors

There is good news for the 70 million U.S. consumers who are behind in their bills and being pursued by a debt collector. The federal Consumer Financial Protection Bureau has proposed new rules that apply to the debt collectors that collect bills for other creditors. The current rules are outdated and inadequate. For example, when existing law was enacted, there was no voicemail, email or text messages. Back when the debt protection laws were written, debt collectors were sending consumers postcards, collect calls and telegrams! Here are the main new rules: Debt collectors would have to tell consumers they could...

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New California Law on Debt Buyers Unfair Practices

New California Law on Debt Buyers Unfair Practices In July, Governor Jerry Brown signed the Fair Debt Buying Practices Act into law effective the 1st of the year. The new law will bar unfair practices of many debt buyers–companies that buy up old debt for pennies on the dollar and then seek to collect from consumers. The debt buyers typically buy old debts from banks–credit card companies–under agreements that the buyers would have very limited access the actual account information for a short period and after that, the debt buyers have to pay the banks to research the accounts. Because...

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The Pros and Cons of Settling Your Debts

This is a guest post from John Ulzheimer, a credit expert and senior columnist for Credit Card Insider on the pros and cons of settling debts that appear on consumers’ credit reports. Over the past four years we’ve unfortunately had to become familiar with the term, “short sale,” which is actually a settlement accepted by your mortgage lender. And while mortgage settlements have become a common practice over the past few years, the process of settling other debts, such as credit card debt and debts being worked by collection agencies is a much more established process. Debt settlement works like...

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Statutes of Limitation on Credit Card Debt Varies from State to State

CreditCards.com reporter Fred Williams has posted an informative report on the statute of limitations that apply to credit card debts. To determine how long a credit card issuer can file suit, a consumer has to figure out which state’s law applies, how long the statute is in that state, and figure out when the statute began to run on the debt. Each of our 50 states has different laws that apply. In California the statute of limitations is 4 years. Generally, the statute begins to run when the debt first becomes delinquent. The reporter found that some 17 states have...

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Debt Collectors Target Relatives of Deceased Persons

Debt collectors are harassing individuals to pay the debts of deceased family members. Many of the targeted survivors are elderly. A WSJ article gives an example of a debt collector retained by Bank of America to collect $16K on a credit card debt from a retired 68 year widow. She received up to 10 calls a day from West Asset Management, Omaha, NE about the debt. The widow was not legally responsible for the debt, but that did not stop the debt collector. The WSJ article has two recorded calls between the harassed widow and the debt collector. The caller...

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