Star Tribune story on lack of judicial oversight for garnishment process
September 2, 2010 by Todd Murray · Leave a Comment
Continuing its excellent “Hounded” series, the Star Tribune ran another story last weekend about the gaps in judicial oversight for the bank and wage garnishment process in Minnesota. The story points out that Minnesota law authorizes garnishments before the debt collector’s lawsuit has even been filed with a court. And even when the debt collector does file the lawsuit with the court before garnishment (and most do), the garnishment process happens largely without any judicial supervision. Only when the debt claims an exemption and requests a court hearing, does the court get involved. The piece tells the story of a couple of consumers that have had a particularly difficult time navigating the exemption process.
After reading the story, I’m even more convinced that Minnesota needs to prohibit any garnishments before filing, and allow pre-judgment garnishment only with a court order. I’ve written about it in the past, but I’d also like to see the existing exemption process blown up, and a new process put in place that prevents creditors from freezing exempt money, even if it’s only for a few days. And as the story points out, states like North Carolina and Texas have created exemptions for money earmarked for reasonable living expenses. But in an allegedly progressive state like Minnesota, there’s no such protection–creditors can garnish money that you’ve earmarked for your basic living expenses, leaving you out of luck.
Justice denied as debt seizures soar | Star Tribune | September 1, 2010
Star Tribune story on people being put in jail by debt collectors
June 9, 2010 by Todd Murray · Leave a Comment
Over the weekend, the Star Tribune ran a story about people that have been put in jail by debt collectors. As I’ve written about in the past, these people are not being put in jail for not paying their debts. Instead, they’re being jailed for not filling out a court-mandated form or for not appearing at a court hearing. But as the story points out, the problem is that many of these people: (a) never received the court forms or notices; or (b) had no idea that they could go to jail if they didn’t follow the rules.
This is yet another example of debt collectors using court rules to bully and intimidate people to make a buck. And while I agree that there should be penalties for not following court rules, this is going too far. No one should end up in jail from a debt collection case. Ever. Period. End of story.
In jail for being in debt | Star Tribune | June 9, 2010
Is jailing debtors the same as debtors jail? | Star Tribune | June 9, 2010
What to know: Avoiding warrants | Star Tribune | June 9, 2010
Top five companies using debt arrest warrants | Star Tribune | June 9, 2010
(photo: mksfly)
What should I do when a debt collector gets a judgment against me?
February 24, 2010 by Todd Murray · Leave a Comment
In a debt collection case, a judgment is a court order that you owe the creditor money. A judgment gives the creditor the power to garnish your bank account and wages. It has a negative impact on your credit score. And in some cases, creditors will exercise their post-judgment power to seize some of your personal property and have it sold to pay the debt. Having a judgment against you is an unpleasant situation to be in and is one of the main reasons why it’s so important to answer the summons and complaint. If a creditor has a judgment against you, here are some of your options:
- Consider a motion to vacate the judgment. If the judgment was obtained by default, you may be able to bring a motion and eliminate the judgment. This will give you a chance to defend yourself. Think of it as a do-over. But you’re only able to get a judgment vacated in very limited circumstances. A consumer lawyer can help you decide if a motion to vacate is right for your case.
- Negotiate a settlement or payment plan. If a motion to vacate the judgment is not appropriate in your situation, your options are pretty limited because the time to dispute the debt has passed. In many cases, your best choice may be to engage the creditor and arrange for payment. That may be the only way to avoid the stress and inconvenience of garnishments. Good deals are hard to come by after judgment because you’ve lost most of your leverage. But if you can demonstrate a significant financial hardship, or have a lump sum of cash available, you may be able to get the creditor to knock a decent chunk of the balance off.
- Remember that the FDCPA applies even after the judgment is entered. So keep a record of all the conversations you have with the debt collector and save all letters and voice mails from them. And if you think that a debt collector has violated the FDCPA, consider talking to a consumer lawyer about the situation.
- If all else fails, bankruptcy may be your best option. If the judgment is for a significant amount of money, or if you have multiple judgments, your best choice may be bankruptcy. Consider talking to an experienced bankruptcy lawyer to figure out whether bankruptcy is right for you.
If you live in Minnesota and want help dealing with a debt collection judgment, feel free to contact me by using the contact form in the upper right corner of this page. I offer a number of flexible representation options, so even if you can only afford to pay a few hundred dollars, I might be able to help you.
(photo: Xurble)
How the FDCPA protects people from collection harassment and abuse
January 26, 2010 by Todd Murray · Leave a Comment
If you’ve been a victim of debt collection harassment or abuse and want to fight back, feel free to contact me for a free case evaluation.
What is debt collection harassment?
December 3, 2009 by Todd Murray · Leave a Comment
Sounds like an easy question, right? But there has been a lot of litigation over what exactly is considered “harassment” or “abuse” under the Fair Debt Collection Practices Act (FDCPA). Here are some debt collection tactics that are definitely considered harassment and abuse under the FDCPA:
- Debt collectors cannot use violence to collect a debt. They can’t even threaten it. This prohibition also covers threats against your children, friends, and other third parties.
- Bill collectors can’t use profane or abusive language. Obviously different people have different definitions of “profane or abusive”. But at least one court has ruled that name calling and racial or ethnic slurs are profane and abusive.
- Collectors can’t call you repeatedly. This not only applies to actual telephone conversations, but also to causing the phone to ring. For example, redialing your number after you’ve hung up the phone.
- Debt collectors must tell you who is calling. Fairly self-explanatory. But there is some debate about whether collectors can use a consistent alias. Not surprisingly, many collectors would rather not use their real name when on the job. So some courts have allowed the use of aliases.
- Any other debt collection conduct where the “natural consequence” is to harass, oppress, or abuse. This is the catch-all provision. Again, it can be tough to define what conduct has the natural consequence to harass, oppress, or abuse, but courts have found the following conduct to be violations of this section: (1) threats to contact third parties; (2) telephone messages left with neighbors when the collector could have reached the consumer directly; (3) use of words like “liar”, “deadbeat”, and “crook”.
If you’re dealing with debt collectors, make sure to download and use my free debt collection call log so that you can document all of the debt collectors’ communications. And if the debt collector does anything that you think was unfair; untrue; or harassing, oppressive, or abusive, please contact me to discuss the situation further. I offer a free case review for all FDCPA cases and if I agree to handle your case, you won’t have to pay me any money up front. My fees come from the money I recover from you if you win your case or accept a negotiated settlement.
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