Cheek Law Offices – Javitch, Block & Rathbone – Keith D. Weiner & Associates – Morgan & Pottinger – Law Offices of Thomas & Thomas – Weltman, Weinberg & Reis – Zwicker & Associates
There are literally hundreds of law firms that do debt collection. Debt collection law firms serve the same purpose as a debt collection agency – attempt to recover money for their client. In addition to normal debt collection remedies, law firms also have the added benefit of being able to file lawsuits against debtors as a last resort to collect on unpaid balances.
In order for a lawsuit to be filed against a debtor, the attorney filing the suit must be licensed to practice law in the state where the suit is to be filed. Often times, creditors will place outstanding accounts with law firms all over the country. Just because a firm is representing a creditor doesn’t necessarily mean they can or will file a lawsuit against you. For example, if a firm is located in Colorado and the debtor lives in Ohio, there is a good chance that firm does not have an attorney licensed to practice law in Ohio. If that is the case, that law firm can only collect on the account.
Should you receive notification that your debt is being collected on by a law firm in the state in which you reside, chances are they have been retained to file a lawsuit at some point in time. Attempting to settle or setup payment arrangements with a law firm may be more difficult than working with a normal collection agency. Some firms have more resources available to them to collect on debts. In addition, they can always hold the threat of lawsuit over the debtors head. Simply having the threat of a lawsuit being filed can be an effective collection tactic.
It’s important to know that the Fair Debt Collection Practices Act (FDCPA) applies to any third party creditor when collecting on consumer debt. This includes debt collection agencies, debt buyers, and debt collection law firms.
The following is an excerpt from the consumer portion of the FTC website. It provides general guidelines as to rights afforded to the consumer as well as what types of tactics collection agencies cannot use. The information below can be found here:
Harassment. Debt collectors may not harass, oppress, or abuse you or any third parties they contact. For example, they may not:
- use threats of violence or harm;
- publish a list of names of people who refuse to pay their debts (but they can give this information to the credit reporting companies);
- use obscene or profane language; or
- repeatedly use the phone to annoy someone.
False statements. Debt collectors may not lie when they are trying to collect a debt. For example, they may not:
- falsely claim that they are attorneys or government representatives;
- falsely claim that you have committed a crime;
- falsely represent that they operate or work for a credit reporting company;
- misrepresent the amount you owe;
- indicate that papers they send you are legal forms if they aren’t; or
- indicate that papers they send to you aren’t legal forms if they are.
Debt collectors also are prohibited from saying that:
- you will be arrested if you don’t pay your debt;
- they’ll seize, garnish, attach, or sell your property or wages unless they are permitted by law to take the action and intend to do so; or
- legal action will be taken against you, if doing so would be illegal or if they don’t intend to take the action.
Debt collectors may not:
- give false credit information about you to anyone, including a credit reporting company;
- send you anything that looks like an official document from a court or government agency if it isn’t; or
- use a false company name.
Unfair practices. Debt collectors may not engage in unfair practices when they try to collect a debt. For example, they may not:
- try to collect any interest, fee, or other charge on top of the amount you owe unless the contract that created your debt – or your state law – allows the charge;
- deposit a post-dated check early;
- take or threaten to take your property unless it can be done legally; or
- contact you by postcard.
Creditors have attorneys working hard for them to collect money from consumers so it only makes sense to obtain legal counsel to represent your own interests. Simply because you are being sued on an account that belonged to you, doesn’t necessarily mean the creditor can prove their claim. An attorney can confirm if the terms of the credit card agreement were followed correctly, interest (if applicable) was calculated properly, and all supporting documentation is in order. If you find yourself on the receiving end of a lawsuit filed against you by a creditor, it’s important to obtain legal representation as soon as possible.