What The Debt Buyers don't want you to know

[01Jes]

Article published around 6/11/2015. As noted here the judge helped consumers sign consent judgments or possibly stipulated judgments without a fair trial. Treated them like trash as if they had no rights. However, I can see why the judge may have done so, if every defendant had a fair trial the court would be a slow process. Lets not forget Consumers have rights.

http://www.jdsupra.com/legalnews/th...ying-19608/?utm_source=JD-Supra-eMail-Digests

This past weekend I attended a workshop in Seattle that was set up for consumer protection lawyers like myself who help people fight back against junk debt buyers like Midland Funding, Cavalry SPV, CACH, LLC (too name a few). The presenter was Peter Holland, a consumer protection attorney in Maryland.

In his opening remarks his description of the debt buying world rang true – it is a world that impacts hundreds of thousands of families each year but has relatively few players – a few dozen debt collection law firms, a relatively small number of judges, and an extremely small number of consumer protection attorneys. Not only that, but most know very little about this segment of the law even though junk debt buyer collection cases clog courts in every states.

This billion dollar industry creates total chaos in countless lives yet if you were to take a poll of random attorneys it is likely that very few would have any understanding of how the junk debt buying system really works. I would venture to bet you could take a poll of consumer protection attorneys and many of them would not even be aware to what extent consumers are being abused and the rule of law set aside in the name of efficiency and “justice”.

And the junk debt buyers like it this way. The less light that is shined on their industry the better it will be for them.

At the conference an audio recording from a recent court session in Washington state was played where a judge was explaining to a group of defendants who had been sued by a junk debt buyer how the creditors’ attorneys were there to “assist the court” in getting the debt collection cases resolved and then actively encouraged each of them to meet with the debt buyer’s attorney and sign off on a judgment. The judge went so far as to tell the small crowd that signing off on the judgment wouldn’t harm there credit so long as they made payments on the judgment (absolutely not true!).

There was no presentation of evidence. No trial. Just a judge telling consumers to go ahead and sign off on the judgment.

It is beyond concerning how defendants in credit card collection cases are treated by the debt buying industry as well as many courts. Safe guards that are put in place in the form of Rules of Evidence and Rules of Procedure are often completely disregarded by the court because “well, they owe someone, right?”.

Obtaining a judgment in court should mean that a creditor has come into court, proven their case with admissible evidence, and demonstrated what is owed and how it was calculated. If a debt buyer can’t do that they shouldn’t be awarded a judgment with all of the power that it provides.

The reason that junk debt buyers get away with rail-roading their cases through the courts is because not enough consumers push back. It is time for people who are the targets of the junk debt buying system fight back against the abuses and hold junk debt buyers accountable for their shoddy, and often illegal, debt collection practices.

 

[focussvtracer]

Have they tried paying for the shit before it goes to collections?

 

[blwn306]

Not everyone is a deadbeat, just this month I was in court for a bogus debt I never owned! I won due to exact reasons posted above, they have to show the original contract and 90% of the time they can't! They try to scare you and pull out all the stops to get you to not show up or settle...

 

[svtfocus2cobra]

I was totally interested until I saw the misuse of "their".

 

[2001sleeper]

When I moved out of an apartment in A&M I was sent a bill for a list of damaged furniture although none was damaged on the final walkthrough. I fought it for about a year before it was turned over to a cow ruins agency. I then fought it for 3 more years before it was dropped.
It actually went through 2 different collection agencies and each tacked on a huge percentage and threatened to ruin my credit.

Bunch of butt holes.

 

[WireEater]

I was totally interested until I saw the misuse of "their".

IKR! God forbid a human makes a simple grammar error.

 

[01Jes]

Not everyone is a deadbeat, just this month I was in court for a bogus debt I never owned! I won due to exact reasons posted above, they have to show the original contract and 90% of the time they can't! They try to scare you and pull out all the stops to get you to not show up or settle...

This.

A debt buyer sued my mother for a debt that was invalid and defective. The balance was incorrect, they had no affidavit of assignment, chain of custody, bill of sale or concrete evidence. There was so many errors on the complaint it was a grammatical shit storm. The account number was also incorrect. I called the collection attorney and demanded a affidavit of assignment. He told me the burden of proof is on me. Lol not a problem.

I filed a motion to assist in accordance with our TX rules of civil procedure 500.4(c) and the judge signed off on my Court Order. I found the original contract and drafted another motion to file private contractual arbitration per the contract, pricey for him to enter the private forum. Only minimal fee for the consumer, I had my claims. I called the collection attorney and explained my position as now he would be dealing with me by the court order. He played hard ball over the phone. Before I had enough time to file my 2nd motion and cc the collection attorney, he decided to non suit the case. The docket was now dead.

 

[ON D BIT]

I heard they buy this debt at 5 cents on the dollar and everything they collect after that is profit. Any truth to that?

 

[VerySneaky]

IKR! God forbid a human makes a simple grammatical error.

ftfy

 

[GT Premi]

I heard they buy this debt at 5 cents on the dollar and everything they collect after that is profit. Any truth to that?

Yep. Otherwise, why would they buy the debt? Most of the debt owed in these cases is from tacked on interest and fees. The principal is practically paid off in a lot of cases. Look at your CC statements or mortgage statements. Most of the money paid is going toward interest/finance charges.

 

[2KBlackGT]

Yep. Otherwise, why would they buy the debt? Most of the debt owed in these cases is from tacked on interest and fees. The principal is practically paid off in a lot of cases. Look at your CC statements or mortgage statements. Most of the money paid is going toward interest/finance charges.

If this is true why don't they just offer to settle the debt with the person owing the money for 5 cents on the dollar?

 

[ON D BIT]

If people knew about this they would not pay more. Get 100k cc bills don't pay for a few months then tell the bank I'll pay it free and clear for 5k cash? I don't think so. If they think you can pay more they will hold out. If they think you don't have the money may let it go for 30-40% with a payment plan.

 

[DHG1078]

If this is true why don't they just offer to settle the debt with the person owing the money for 5 cents on the dollar?

They would have to have a 100% success rate in collecting debts for that to work out, and even then they still need to collect more to make the business profitable.

 

[01Jes]

If people knew about this they would not pay more. Get 100k cc bills don't pay for a few months then tell the bank I'll pay it free and clear for 5k cash? I don't think so. If they think you can pay more they will hold out. If they think you don't have the money may let it go for 30-40% with a payment plan.

You're correct most collection agencies or debt buyers calculate if you can pay. They ask hardship information, investigate credit reports and make a calculated decision if the debtor is worth pursuing. If you're a good candidate they file a lawsuit. Most debt buyers know the debtor will beg, borrow or steal to avoid a judgment. Only 5% answer the suit and fight back. Majority of attorneys defending the debtor only know 1 word...settle. The debtor could do that without counsel. If the plaintiff files the lawsuit they must prove their case and actually show up to court with a litigant individual. Most don't have the goods.

 

[GT Premi]

If this is true why don't they just offer to settle the debt with the person owing the money for 5 cents on the dollar?

Because that would basically be admitting to the debtor that they've been overcharging them all along. Way back in the day, I tried that very thing. The person on the phone told me "it doesn't work that way." When I asked why not and what's the difference between settling with me directly versus selling to a collection agency, all I got was crickets. Thankfully, those days are way behind me and hopefully never to return. I checked my Equifax score last night and I have an 820 credit score!

 

[2KBlackGT]

Because that would basically be admitting to the debtor that they've been overcharging them all along. Way back in the day, I tried that very thing. The person on the phone told me "it doesn't work that way." When I asked why not and what's the difference between settling with me directly versus selling to a collection agency, all I got was crickets. Thankfully, those days are way behind me and hopefully never to return. I checked my Equifax score last night and I have an 820 credit score!

Man, it's a dirty game.

 

[o2gt]

Interesting article . I took a consumer transaction class my last semester of law school. we studied a lot of the things being talks about in both this thread and the article. Its really an interesting segment of law. My professor told us about on collection agency setting up a fake court room. there was a fake bailiff and judge. it was crazy to think about. there are some good laws out there to protect people both on the federal and state levels.