Debt Collectors Misled Borrowers
Court Finds that Debt Collectors Misled Borrowers
A debt collection agency recently sent a letter to borrowers telling them that their student loan debts could not be discharged in bankruptcy, and must be paid. The truth is, student loans CAN sometimes be discharged in bankruptcy, although it is uncommon. Read more about this topic here.
Debt collectors misled borrowers often, judging from the number of successful Fair Debt Collection Practices lawsuits against them. If you have been harassed, lied to, contacted at unusual hours, or otherwise abused by debt collectors, you may be entitled to compensation.
Long Island Litigation Attorneys
The attorneys at The Law Firm of Vaughn, Weber & Prakope, PLLC can help in these matters. Call (516) 858-2620 today for a free consultation!
Flawed Credit Card Lawsuits
Flawed Credit Card Lawsuits
Debt collectors are not the only ones filing faulty paperwork in an attempt to collect on alleged debts. As was reported in a recent New York Times article, original creditors are also filing faulty paperwork and overstating amounts owed in their credit card lawsuits. However, the article shows that Judges are starting to get wise to this:
The same problems that plagued the foreclosure process — and prompted a multibillion-dollar settlement with big banks — are now emerging in the debt collection practices of credit card companies.
As they work through a glut of bad loans, companies like American Express, Citigroup and Discover Financial are going to court to recoup their money. But many of the lawsuits rely on erroneous documents, incomplete records and generic testimony from witnesses, according to judges who oversee the cases.
Lenders, the judges said, are churning out lawsuits without regard for accuracy, and improperly collecting debts from consumers. The concerns echo a recent abuse in the foreclosure system, a practice known as robo-signing in which banks produced similar documents for different homeowners and did not review them.
‘I would say that roughly 90 percent of the credit card lawsuits are flawed and can’t prove the person owes the debt,’ said Noach Dear, a civil court judge in Brooklyn, who said he presided over as many as 100 such cases a day.
The problem is that the creditor is usually granted a default judgment because the borrower does not show up for court. This typically results in the borrower being responsible for whatever amount the lender alleged was owed in their complaint. The amount alleged to be owed is not always accurate! The same NYT article states that “The Office of the Comptroller of the Currency is investigating JPMorgan Chase after a former employee said that nearly 23,000 delinquent accounts had incorrect balances, according to people with knowledge of the investigation.” So, as we have stated in the past, it may be a good idea to defend that credit card lawsuit!
The Law Firm of Vaughn, Weber & Prakope, PLLC can assist you with debt settlement and debt collection issues. Call (516) 858-2620 to arrange a FREE consultation with an attorney!
We have been successful in getting debt collectors to drop their lawsuits against our clients.
In a recent case of ours, the debt collector filed a 1 page complaint seeking thousands of dollars in alleged unpaid charges. We defended the debt collection lawsuit by filing a 21 page response. A few weeks later the debt collector voluntarily dismissed its lawsuit with prejudice.
Most of us have heard that banks are having trouble foreclosing on home loans because they can’t “produce the note.” Well, debt collectors are having similar issues. Basically, debt collectors can’t prove that they are the proper party entitled to enforce the alleged credit agreement.
We proudly assist residents of Nassau county, Suffolk county, Queens, Brooklyn, Bronx, Staten Island, and Manhattan with debt settlement and debt collection defense. Call (516) 858-2620 to arrange a FREE consultation with an attorney!