Questionable Bill Collection Techniques (continued)

Hi,
In my last blog, I referred to a few questionable techniques employed by a small percentage of bill collectors. Some additional ones to be aware of are:
1) Bill collectors will often use the term "garnishee wages" as leverage to get a debtor to pay on an account. They often speak as though garnishment of wages will happen overnight. In reality, wages are only subject to garnishment after judgment has been rendered which takes 45-60 days minimum in most states.
2) Another form of leverage used by bill collectors is to mention highly inflated attorney fees that the debtor will be responsible for if a small balance isn't paid in full. For example, a debtor owes a bill of $400.00. The collector calls the debtor and tells him or her that the client is prepared to sue and the attorney fees will be $1,400.00-$1,500.00 to coerce the debtor into paying the bill. In reality, chances are the client will not sue for such a small balance. In addition, the attorney fees would not be as excessive as the collector claims, IE., four times the amount of the bill!
3) Another common form of leverage used is when a collector tells a debtor that a lien will quickly be placed on his or her house. Once again, in most instances, and for most debts, the only way a lien can only be placed on a house is after judgment is rendered and the judgment is registered in the county in which the property is located.
These are just a few more examples of inappropriate collection techniques that are highly illegal, and, if encountered repeatedly, should be documented and reported to the State Attorney General.
Until later,
Alan

Judgments

Hi,
The purpose of this blog entry is to take some of the mystery out of judgments. A creditor's last option in collecting a debt is very often done by obtaining a judgment. When a creditor obtains a judgment, it means that a court grants the creditor an order containing multiple remedies to collect an unpaid debt.
To obtain a judgment, a creditor must do the following:
1) Creditor files a lawsuit in the jurisdiction where the debtor lives for the amount of the debt.
2) The lawsuit must be served on the debtor. This is usually done by a process server. If the debtor is successful in avoiding the process server for a period of time, sometimes the creditor may obtain service through publication in a local paper.
3) In most states, the debtor has 21 days to respond in writing to the lawsuit.
4) If no response is given, a default judgment may be granted to the creditor by the court.
5) If, after service, the debtor disputes any part of the amount that the creditor is claiming, he or she may do so through the courts. The matter will be resolved through the courts before judgment may be entered.
Following are some of the remedies available to a creditor if a judgment is obtained against a debtor:
1) Any real property owned by the debtor in the county that the judgment is entered will automatically have a lien placed against it. The creditor also has the right to register the judgment in any county in the state in which the judgment was granted in which the debtor might own property.
2) The creditor may garnish the wages of the debtor.
3) The creditor may garnish the debtor's bank accounts.
4) The creditor may seize any assets that are free and clear of liens or encumbrances.
5) The creditor may have the debtor brought in for examination and deposed of any other assets.
6) If the debtor moves out of state, the creditor may register the judgment in the debtor's new state of residence and proceed against the debtor.
This list of actions is not all inclusive, but gives an idea of liabilities which a debtor may incur if a creditor is awarded a judgment.
Until the next time,
Alan