Does The Fair Debt Collection Pracctices Act Protect Against Wage Garnishment?

Many people facing bankruptcy wonder if the Fair Debt Collection Practices Act (FDCPA) will protect them from wage garnishment, unfortunately the answer is - no. The FDCPA is a law that places limitations on the methods that debt collection agencies can attempt to compel debtors to pay off their debts. For instance, the FDCPA limits the times that debt collectors can call debtors and it does not allow these agencies to make threats that they cannot legally act upon. If a debtor defaults on a loan, the lender will initially attempt to collect on the debt on their own. If initial attempts to collect on the debt fail, the lender will usually assign that debtor's account to a collections agency. After the debt collector makes numerous attempts to get the debtor to repay his or her debt, it may institute a legal action against the debtor in court. If this happens, the debtor will receive a summons notifying them that they are being sued and they will have 35 days to answer the summons. If the debtor fails to respond to the summons, under New Jersey Court Rule 1:13-7, the court will enter a judgment against the debtor upon the creditor's request. Next, the court may allow the creditor to garnish the debtor's salary as a means to repay the debts that were the subject of the judgments. Under N.J.S.A. 2A:17-50, as long as a debtor makes more than $48.00 a week, a creditor may garnish his wages for repayment on a debt. The creditor who has received the legal judgment against the debtor will get a writ, or document from the court, and send it to the debtor's employer notifying them of the wage garnishment. Under federal law, only 25% of a debtor's disposable income may be garnished to satisfy a debt. A debtor's income calculation, for the purposes of wage garnishment, does not include government entitlements and payouts such as social security payments, disability benefits, or other state benefits. If you are having trouble dealing with your consumer debt and would like to know more about the FDCPA or fear that your wages may be garnished to satisfy your debt obligations it is imperative that you seek the advice of experienced legal counsel to advise you on the issues concerning bankruptcy. For more information regarding the Fair Debt Collection Practices Act (FDCPA), when you should file for bankruptcy, Chapter 7 bankruptcy, Chapter 13 bankruptcy, foreclosure or any other consumer debt issues visit TheNJBankruptcyAttorney.com. This blog is for informational purposes only and not intended to replace the advice of an attorney.

FDCPA Offers Protection From Harassing Creditors

The Federal Trade Commission released a study on January 30, 2013, discussing the shady actions harassing creditors take to unfairly collect debts. Many of these debts are usually from credit cards and can be discharged if the debtor files a Chapter 7 bankruptcy. The FTC found that debt buyers, usually collection agencies or law firms who have bought the debt from the original creditor, often lack basic information about the debt they are trying to collect. Many times they do not even know if the debt is valid, whether the consumer has disputed the debt or even when the statute of limitations has run on the debt. The FTC requires that creditors have a reasonable basis for believing a debtor lawfully owes the debt they are trying to collect on, yet some creditors cannot even establish that much when they file judgments against debtors! The FTC concluded that the Fair Debt Collections Practices Act (FDCPA) should be updated to better protect debtors from unscrupulous debt collectors. In the meantime, if you are considering filing for bankruptcy and are receiving harassing communications from creditors who may not even have a legitimate claim against you, remember filing for bankruptcy will stop the harassment and allow you time to scrutinize your debts. If you are considering filing for bankruptcy you will be addressing many issues concerning protection from creditors and should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information on how to protect yourself from creditors, foreclosure, other consumer debt or bankruptcy law matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.

FDCPA Provides For 30-Day Dispute Period

In a recent consumer debt matter Stokes v. Transworld Systems Inc., an individual, Pamela Stokes, brought a class action suit against Defendant Transworld Systems, Inc. (TSI) for claimed violations of the Fair Debt Collection Practices Act (FDCPA) following her receipt of collection letters she received. Stokes claimed that reference to the 30 day FDCPA dispute period in a second collection letter and reference to a legitimate debt in a third collection letter were misleading and deceptive and would confuse the "lease sophisticated consumer" about how to dispute the validity of the alleged debt. The first letter from TSI set forth an amount due and informed Stokes of a 30 day notice to dispute the debt and how to do so. The second letter explained that, if the debt was not disputed within the 30 day dispute period set forth by the FDCPA, it would be assumed valid and collection efforts would continue. After the 30 day FDCPA dispute period expired, Stokes attorney sent a letter via facsimile, certified and regular mail pursuant to 15 U.S.C. 1592c(c) demanding TSI cease and desist all collection efforts immediately, cease direct communications with Stokes, disputing the debt, demanding verification of the debt and the name and address of the original creditor. The following day, TSI sent a letter directly to Stokes seeking payment in order to avoid transfer of the matter to telephone collectors. The purpose of the FDCPA is to protect consumers by eliminating abusive practices by debt collectors, protect debt collectors using legal collection methods. The courts, in effecting the acts intent, have reviewed the creditors' actions under the "least sophisticated debtor" perspective. Communication is deceptive within the FDCPA if it can reasonably be read with 2 or more different meanings and one would be considered inaccurate. The primary question in determining FDCPA violations is whether the "notice fails to convey the required information clearly and effectively and thereby makes the least sophisticated consumer uncertain as to the meaning of the message" Weiss v. Zwicker, 664 F. Supp. 2d 214, 216 (E.D.N.Y. 2009) Not every letter sent from a debt collector within the 30 day dispute period violates the Act. A follow-up letter need not restate the rights set forth in the initial validation notice, nor must it set forth the expiration date of the 30 day dispute period. Simply put, follow-up letters must not confuse the least sophisticated debtor as to their rights under the FDCPA. Therefore, the actions of TSI were held to be valid and Stokes matter was dismissed. If you are facing mounting debt or believe a debt collector is pursuing you inappropriately, you should consult with an experienced bankruptcy attorney immediately in order to protect your rights. For more information regarding how the FDCPA can protect you from harassment and unfair collection practices or for information regarding bankruptcy, foreclosure or other consumer debt matters in New Jersey visit TheNJBankruptcyAttorney.com. This blog is for information purposes only and in no way is intended to replace the advice of an attorney regarding your specific matter. We are a Debt Relief Agency. We help people file for bankruptcy relief.