Blog
Wednesday, 11.04.09: Date of First Delinquency and the FDCPA
So here's the question of the day, which I received from an attorney in Virginia and has to do with the date of first delinquency on a charged off credit card account that was in collections.
The question was wether or not the date of first delinquency is important in the credit score. And, if the date of first delinquency is changed to a more recent date does that constitute re-aging. And lastly, would I consider being his credit expert witness in this matter.
The answer to the first question is yes, it is important. The answer to the second question is maybe. If the collection account, in its original form with the original creditor, went seriously past due on the same date that's being reported as the date of first delinquency date then no, it's not re-aging. But, if the account went seriously past due prior to that date then there may be a re-aging issue.
And the answer to his third question was that I'd consider being his credit expert witness.
Monday, 10.19.09: Can't Violate FDCPA in Order to Comply with FDCPA
Originally published by CourtHouse News Service
(CN) - The 11th Circuit rejected a debt collector's claim that it had to violate the Fair Debt Collection Practices Act to comply with it. The court said the argument "offers up much the same logic" as a military officer's often-repeated statement about Vietnam, "we had to destroy the village to save it."
Niagara Credit Solutions left at least two "urgent" messages on Brenda Edwards' answering machine without revealing that it was a collection agency, trying to collect money owed to the Consumer Shopping Network.
The collection agency claimed that it didn't disclose the information for fear of violating another FDCPA provision, which bars collection agencies from discussing the debt to third parties.
"It was concerned that answering machine messages might be played by or within the hearing of a family member or roommate, who would then know that a collection agency was calling the debtor," Judge Carnes explained.
But the Atlanta-based federal appeals court rejected this defense to Edwards' lawsuit.
"It was not reasonable for Niagara to violate (one provision) of the Fair Debt Collection Practices Act with every message it left in order to avoid the possibility that some of those messages might lead to a violation of (another)," Carnes concluded
Wednesday, 10.14.09: Think Twice About Credit Reporting
For debt collectors who choose to report their debts to the three credit reporting agencies they must do so very carefully. They must maintain reasonable procedures to ensure maximum possible accuracy thanks to the Fair Credit Reporting Act. The minute a collection agency, or any data furnisher, chooses to report information to the credit reporting agencies they become obligated under certain provisions of the FCRA. In many of the cases where I've been an FDCPA expert witness or FCRA expert witness there is a component of the complaint that alledges credit damage. And, of course, in order for their to be credit damage there has to at least be credit reporting.
So while many collectors enjoy the leverage credit reporting provides them, the downside is also significant. So think twice before you choose to report your collection debts to the credit bureaus.
Please contact John Ulzheimer via the Contact function of this website if you would like to discuss FDCPA expert witness, FCRA expert witness or credit damage expert witness needs.
Thursday, 09.24.09: Collector Speaks Out Against FDCPA Lawsuits
According to Joel Lackey, Owner of an Atlanta based collection agency, it can cost a collection agency $4,000 to settle an FDCPA lawsuit even though they did nothing wrong and the charges against you were completely unreasonable or fabricated. He further states that a roll of the dice to take a case to court to prove your innocence could cost upwards of $30,000, if you prevail of course. If you lose then the cost to the collection agency can multiply.
As an FDCPA expert witness I have witnessed first hand a large number of "shake down" lawsuits against collection agencies. Some have thrown a few dollars at the Plaintiff's attorney and seem to have come to view these thousand dollar settlements as a cost of doing business and controlling their downside risk. On the flip side, I have also seen some lawsuits that have merit because the collector seemed to ignore and violate the FDCPA in their collection activities.