Incomes Growing Faster than Debt in US
Did you ever have a debt that seemed to disappear? You may have received multiple debt collection calls after your first couple missed payments, but after a while, they seemed to stop randomly. You may have seen this as a blessing as you no longer had to face those torturous calls, but what was transpiring behind closed doors may have created an even bigger problem.
You randomly receive a call months later from a collection company you’ve never heard of, and they are demanding immediate payment. You ignore future calls as you assume they have the wrong person, but unbeknownst to you, you’ve just been introduced to a debt buyer.
How Debt Buying Works
Creditors are institutions that issue credit to consumers. When you sign up to open a line of credit, you agree to make on-time scheduled payments on the account. When you fail to do so, your original creditor will begin making contact attempts to remind you of your missed payments. After 180 days from the last payment, the creditor can charge-off your account. From here they can either hire a third-party debt collector to recover funds or sell your portfolio to a debt buyer.
Debt buyers can come in the form of both private collection companies and massive publicly traded collection agencies. Creditors sell accounts to debt buyers for pennies on the dollar as a way of getting somewhat of a return on an account that may have otherwise never seen another payment. Debt buyers can handle the acquired account in one of the following ways:
- Resell portions of the debt
- Renegotiate repayment terms with the debtor
- Implement previously forbidden collection tactics
The Supreme Court recently upheld the decision of debt buyers not being subject to the Fair Debt Collections Practices Act (FDCPA), which prohibits original creditors from intrusive tactics like masking identity, calling family members, and lying about the amount owed. With debt buyers being able to operate in this debt collection loophole, they potentially increase their chances of recovering payment. Even the smallest payment may be worth more than what they paid for the account.
Defenses to a Debt Buyer Lawsuit
Some of the more unrelenting debt buyers are known for pursuing debt collection lawsuits. These include:
- JRSI, Inc.
- Midland Funding, LLC
- CACH, LLC
- Portfolio Recovery Associates, LLC
- HBLC, Inc.
- Stellar Recovery
- Cavalry SPV I LLC
- Atlantic Credit and Finance
- Unifund CCR Partners LLC
- Resurgence Legal Group
- Velocity Investments LLC
- MSW Inc
- Razor Capital
It is vital that you do not allow a lawsuit to be the reason you succumb to the pressure of paying a debt buyer. Many companies use this as a scare tactic with the hopes that the threat of legal action will push the debtor to resume payments on the account. What they do not expect, however, is for you to acquire legal representation and refute the charges. An Illinois credit card debt attorney can present the following defenses to a debt buyer lawsuit:
- Lack of legal standing
- Missing paperwork
- Inaccurate billing/payment information
- Expired statute of limitations
- Debt belonging to another individual
Heather Benveniste is an experienced Illinois debt lawsuit attorney who can help you combat legal action from a debt buyer. With seven years spent as a debt collection lawyer, she has insight as to how the plaintiff will approach a lawsuit and can use that knowledge to your advantage. Contact us today at 1-800-497-5358 for a free case evaluation.
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