Tag Archive | FDCPA

Statute of Limitations for Credit Cards

What is the Statute of Limitations for Credit Cards in Pennsylvania?  We get calls asking this question every day.  In most instances, the statute of limitations on a collection claim in PA is 4 years.  There are a few exceptions, namely for Discover and Capital One accounts, which may be only 3 years.  Discover and Capital One may have different (and lesser) statutes of limitation due to the contract that they include with their accounts.  Not every contract has the same language, but some of them do.

When does the Statute of Limitations start?  The SOL starts when the account or claim goes into default.  Default occurs when you fail to make a payment, in most instances.  As an example, you make a payment December 31, 2009.  The next payment presumably is due on January 30, 2010.  If you fail to make that payment, then the statute clock starts to click.  If there is a four year SOL at work here, then the claim against you would have to be filed by January 30, 2014.  If the claim is filed after that date, then the claim may be “time-barred”.  Time barred simply means that a claim is too late, it does not mean that the collector cannot sue you.  What I mean is that time barred lawsuits are filed every day.  You cannot simply call up the collector and say “this is too late, drop it”.  That phone call is rarely going to work.  Instead, you are going to have to assert your defenses to the lawsuit by filing a responsive pleading.  Then, you may have to go to a hearing or have a motion for summary judgment scheduled.  The point being made here is that many people believe that if the lawsuit is too late, they can either ignore it or they can simply call the court or opposing attorney and ask them to withdraw the case.  I can say that rarely is an effective maneuver.

If a credit card collection action is filed against you and you think that the SOL has run, you should consult with a consumer attorney right away.  The action of filing a claim after the SOL has run is illegal and is contrary to the Fair Debt Collection Practices Act (FDCPA).  This can result in you filing a claim against the debt collector who sued you.  Such a lawsuit would entitle you to up to $1000 in statutory damages, plus any actual damages, plus recovery of reasonable attorney fees.

Posted in Lawsuits

Debt Collection Letters on Out of Statute Debts

Are you getting debt collection letters on very old debts?  All states have a statute of limitations on the collection of debts.  A statue of limitation is the time period within which you must be sued on a given claim. It is also called a time-barred debt. It is an affirmative defense, in other words, you must raise the defense in your answer to the collection complaint.  If you fail to raise the defense, then you are deemed to waive it. What is the statute of limitations in Pennsylvania? For a typical credit card case it is four (4) years, but maybe as short as three (3) years for Discover Bank and Capital One cards.

So, you get a collection letter on an account that you know is over the statute of limitations. What do you do?  You should keep both the letter and the envelope that it came in.  If the debt collector failed to tell you that it was out of statute or failed to tell you when the last payment was on the account, you may have a violation of the Fair Debt Collection Practices Act (“FDCPA”).

The FDCPA is a law that governs the behavior of debt collectors. It is only applicable to consumer debts, not debts that you would have incurred in a business or for a business purpose. It is a remedial statute and will be construed broadly in order to give it the full effect. The Courts interpret the FDCPA not from your individual perspective, but from a much lower standard, the “least sophisticated consumer”. The law states that if the debt collector violates the FDCPA it must pay your reasonable attorney fees and costs and you are entitled to your actual damages and statutory damages.  The FDCPA was written to provide for attorney fees so that it would be enforced by private attorneys.  Without the fee shifting, the FDCPA would only be worth the paper it’s written upon.

A recent court decision helps to clarify that it is a violation of the FDCPA when a debt collector is collecting on a time-barred debt and used the word “settlement” in the letter.  The Court in McMahon v LVNV Funding, LLC, et al. held that even in the absence of a threat of litigation, the use of the word “settlement” would lead the least sophisticated consumer to believe that the debt was legally enforceable or collection litigation might still occur on the time-barred debt.

So, you if you have any collection letters on a debt you know is out of statute within the past one (1) year you should contact our office for a review of the letter.  You may email or fax a copy of the letter to us for a free no obligation review, making sure you have a cover sheet with your contact information.  Attorney Clay Morrow from our office will be glad to review your letter and advise as to the proper course of action.

Posted in Illegal Threats

Brachfeld Law Group

Have you received a letter from Brachfeld Law Group?  We have come across a few of these recently, and we have discovered that some of their letters violate the Fair Debt Collection Practices Act. We have discovered that their initial letter to alleged debtors fails to include language that is required under 1692(g) of the FDCPA , informing the debtor that any disputes regarding the validity of the debt must be in writing. The failure to include this language is a clear violation of debt collection laws.

If you have such a letter, you must act quickly.  Fax a copy of the letter, front and back and the envelope that it came in to 412-386-3184.  Please be sure to include your contact information (email address, phone number) so that we may get in touch with you.

We never charge upfront fees on FDCPA claims because we simply don’t have to.  The FDCPA has a fee shifting provision that requires the debt collector to pay our reasonable attorney fees when we are prosecuting an FDCPA claim.

Posted in Collection Agencies, Illegal Threats

Suing the Debt Collector

Today, March 30, 2010,  there was a fine article published on MSN money regarding suing  an abusive debt collector.  Founding partner at Morrow & Artim, Clay Morrow, was interviewed for the story.  Clay was able to discuss a recent victory where he sued a debt collector after the collector threatened to show up at our clients place of employment.   See the link here http://articles.moneycentral.msn.com/Banking/YourCreditRating/sue-your-debt-collector.aspx

Posted in Illegal Threats

FDCPA – Instant Success Story

Bob and Mary (fictitiuous names, of course) had a delinquent account with a major credit card company. The credit card company hired a collection agency to assist in collection of the debt.  The collection agency placed a few calls to Bob and Mary, who chose not to speak with them. Undeterred, the collection agency called Bob and Mary’s neighbor and asked them to hand deliver a note to Bob and Mary.  The collector asked the neighbors to write down the  following message : ” This is Joe from XYZ colleciton agency.  I am troubled to hear that you do not want to take my calls. We really need to settle this debt so call me back right away”.  The neighbor handed the note to Bob and Mary, who fortunately called our office right away.

It is illegal for any debt collector to contact a friend, neighbor, family member or anyone at your place of employment to discuss your debt with them. (They may contact one of these third parties only to locate you, if they have made reasonable efforts at finding you that were not successful). The Fair Debt Collection Practices Act (FDCPA) sets forth many rights that consumer or debtors have in regards to delinquent accounts and collection activities that take place as a result thereof.

My partner, Clay Morrow, contacted the collection agency right away and advised them of our representation of Bob and Mary. Clay advised that the activities were illegal and that we would be bringing a claim against them.  The collection agency knew that their actions were illegal so there wasn’t much of a fight. They do these things because they know that 1) these tactics are often successful and 2) that most people will not bother to consult an attorney.

Within a matter of 10 days, Clay was able to obtain the full amount of the statutory damages ($1000) plus attorney fees for Bob and Mary.  Clay was also able to settle the underlying debt with the original credit card company for a small fraction of the actual debt.  Great job Clay!

Posted in CC Companies, Collection Agencies, Illegal Threats

Fair Debt Collection under the FDCPA

We hear about unsavory collection agencies on a daily basis. They either make illegal threats, such as wage garnishment, pressing fraud charges or jail time, or, they harass you by calling you names like deadbeat, ignorant, loser and so forth.  Then, they contact your family and friends to try to get them to pay the debt for you, or, they contact your neighbors and employer with questions about the debt. 

All of the above actions are illegal under the Fair Debt Collection Practices Act. The Fair Debt Collection Practices Act (FDPCA for short) is a federal law that governs what a debt collector may do or say when it is attempting to collect a debt.

A debt collector may not threaten to take any action that is illegal, period. In the above examples, wage garnishment is a big one that we see quite often. To be clear, a debt collector may not garnish your wages in Pennsylvania for a credit card debt. There are no ifs, ands or buts to that statement. Therefore, if a debt collector makes such a threat, it is illegal and you may have a claim against them for their unfair practices.

Again, referring to the above examples, we hear of debt collectors who contact family, friends, employers and neighbors about outstanding debt. This type of activity is usually illegal, but not always.

To explain, generally, a debt collector may not speak with or contact anyone else about your debts. For the most part, an employer may never be contacted about a credit card debt. With regards to friends, family and neighbors, the same is true but with one general exception.

If a debt collector cannot find you, they may contact others to ascertain your location and contact information.  Again, they have this permission only if they cannot find you. They may not speak with others about the nature of their business, they may not tell anyone that you allegedly owe a debt.  Their sole purpose in contacting a friend, neighbor or family member can be only to locate you.  If the debt collector has a valid address and phone number for you, they have no reason or right to contact anyone else about your alleged debt.  Such an action would be illegal.

If one of the above examples should happen to you, please know that you have rights under the FDCPA. Our firm, specifically through my partner, Clay Morrow, can bring a claim against the debt collector for its illegal activities. Generally, you are entitled to a statutory damage amount $1000 AND you receive your reasonable attorney fees for prosecution of the claim. In that regard, we do not charge an up-front fee to pursue these claims on your behalf.

If a debt collector has threatened you, or discussed your alleged debt with someone else, please contact our office right away so that we can begin a claim for you.

Posted in Other

My New Partnership

As of January 1, 2010 I am pleased to announce that I have formed a new partnership with one of the best consumer attorneys in Pennsylvania, Clay Morrow.  Clay and I have been working together on cases for quite some time now and we decided that it was best to form a partnership that would better serve our clients.

Clay has been practicing consumer law in PA for over 20 years now and has seen just about everything that there is to see in that arena. Clay is a member of NACA, which is the National Association of Consumer Attorneys, and is quite active with that group.

Clay will handle all claims that are filed against debt collectors. These claims are often based upon illegal threats or activities that debt collectors engage in when they are trying to collect a debt from you. Clay bases most of these claims on the Fair Debt Collection Practices Act (FDCPA) which provides consumers with an array of rights and protections. Clay is able to handle these claims on a no-cost basis, which means that you typically do not have to pay our firm a retainer to pursue an FDCPA claim against a debt collector.  Our firm will earn its fee and have it paid by the offending debt collector.

I will continue to handle the defense of collection agency and credit card lawsuits as I have in the past. What I have found in my experience in handling these matters is that there is often a violation of the FDCPA that is made either before the lawsuit is filed, or, in the lawsuit itself.

So in a nutshell, I will act as your shield in defending you, and Clay will act as your sword in attacking these violating debt collectors.

Posted in Other

Illegal Debt Collection Threats

You had better pay this debt you deadbeat! We’re gonna garnish your wages… We’ll press fraud charges against you for failing to pay this debt!

These are some of the more common threats that we see in the credit card cases lawsuits that we defend.  ALL of these threats are illegal. There is a federal law known as the Fair Debt Collection Practices Act (FDCPA for short) that makes these sorts of threats illegal. The FDCPA sets forth that these threats, and others just like them, are against the law AND it also gives you the right to sue the debt collector! Each threat or violation is a possible $1000 fine that you can recover from the collection agency AND you also can obtain your reasonable attorney fees in prosecuting the claim.

In that regard, our firm does not charge an up-front retainer when we take on FDCPA violation cases. We simply handle the case, we have the collection agency pay your claim, and we have them pay our fees as well. 

If a collection agency or debt collector makes any sort of threat to you that sounds illegal, or just plain wrong, then it probably is.  Contact our office for a free, no obligation review of your potential case.

Posted in Collection Agencies, Illegal Threats, Lawsuits

The Garnishment Threat

The collection agency calls and says that you better pay up.  If you don’t pay, then we’ll garnish your wages.  Believe it or not, that can be a great phone call to receive if you live in Pennsylvania.

This is a common threat that is issued by the collecton agencies.  It works very well for them because nobody wants their wages to be garnished.  Unfortunately, it is also an illegal threat. 

Pennsylvania is one of the few states that do not allow creditors to  garnish wages.  There is no exception to that law, at least not when a collection agency or credit card company is involved.  Wage garnishment for credit card debt cannot occur in Pennsylvania, period. 

Regarding the threat, as I said above, it is illegal.  There is a federal law known as the Fair Debt Collection Practices Act (FDCPA for short) that protect consumers.  One of the main components of this law is that a debt collector cannot make a threat that it cannot follow through on, or it can’t make a threat that is illegal.  Since wage garnishment is not permissible, by law, in Pennsylvania, making such a threat is illegal. 

The FDCPA gives you the right to file a lawsuit against a debt collector that makes this sort of illegal threat.  There is a statutory $1000 damage penalty, along with an imposition of reasonable attorney fees.  In that regard, your attorney is free.

Call our office if you have been threatened with wage garnishment in Pennsylvania.

Posted in Collection Agencies, Garnishment, Lawsuits


Credit Card Lawsuits

If you are faced with a credit card lawsuit, whether its an original creditor or a junk debt buyer, contact my office at 412-823-8003 right away. We offer a free, no obligation review of any credit card based lawsuit that is filed in PA.

FDCPA Attorneys

Many Debt Collectors threaten people, that's a fact. Threats of wage garnishment, jail, fraud charges and contacting employers, friends and relatives happens every day to people just like you. The truth is that most of these threats are illegal. If a debt collector is threatening you, contact our office at 412-823-8003 for a free initial consultation.