Help - A collection agency is trying to strong arm me!?

Question

I've been trying to improve my credit, but with lots of old bills and living paycheck to paycheck, I have a ways to go and it's going to take some time. An old Visa account of mine was sold to a collection agency. I started getting a lot of calls, so I called them back, willing to work with them and make arraingements (I had been paying 20.00 a month before). They not only want 150 per month which I just can't do right now, but they absolutely refuse to allow me to make payments by mail. They insisted I let them set up an auto payment directly from my checking. I absolutely and steadfastly refuse to allow that. I've had too many bad experiences with this sort of thing in the past, and I refuse to let my paychecks be held hostage. They told me Florida is a garnishment state and got belligerent. I finaly said I'll talk to a lawyer and call you back. They hung up in my face. Help me please, does anyone know if they have a right to dictate how I pay them, and can they garnish?

Answer 1

The only way that they can garnish you paycheck is if they take you to court and get a judgment.

They are correct Florida is a garnishment State but if you are the head of household you are exempt. Also if you are not the most they can hold is 10% or contract rate not to exceed 18%.

You should check into the statute of limitation in Florida, its 4-years for credit card accounts, you may be past that. If you are they can not even sue you. If you are past the SOL do not pay them a dime there is nothing they can do legally.

Answer 2

OK.. Florida law will allow or forbid certain practices, but the federal Fair Credit Practices act establishes some basic guidelines. Go on line and read it and find out what your applicable rights are.

Second: Federal Law - US Dollars (cash) is payment for ANY debt. They can not refuse to accept that. (Its even PRINTED on ever bill). Now having said that a CHECK or a bank money order is NOT cash.

So.. if they are nearby you can go down there and pay them in cash. They can not legally refuse to accept it.

Next: do you owe the collection agency or are they acting as an agent. If they are an agent, ignore them and contact the company that you owe. Work out a payment plan with them and scr*w the agency. They will be happy to get their money and they will get it without having to pay a percentage to the collection agency. You may even be able to negotiate a discount based on what you will save them (sounds almost too good to be true doesn't it - well it only costs you a phone call to try).

You should also find out what the maximum interest rate on your various debts is once it goes to collection. Some places will continue the banks 22% (ouch) when state law may only allow 7%.

Start documenting your calls from the collection agency. Specifically, tell them that you are no longer accepting verbal communication and all correspondence must be in writing. Get them to say they will not accept a partial payment in writing and you will have a powerful weapon if they decide to sue you for the amount.

Bottom line tho... work responsibly with the people that you owe money to ... a good creditor will accept that and work with you to solve your debts. If not consider the services of a Credit consolidation agency.. sometimes that works.

good luck

.

Answer 3

You can only afford what you can afford. I believe it is against the law for them to continue to harass you, but since you don't really have the money to pay for a lawyer to send them letters, you might have to put up with the phone calls.

I would send them a letter stating that you are paying every month what you can afford to. After all, you still have to food on the table and turn the lights on. You can always fire back at them that you will file bankruptcy.. and then they will never see the money.

Which, bankruptcy is not all that bad. It will hurt you for the first 2-3 years. You will still be able to buy things and you can even get a credit card with a secured limit on it to help rebuild your credit. But I am getting off track here.

What ever you do- DO NOT let them have access to your bank account. There is no reason for it. Not one. I would say, if you are paying what you can and want to continue to pay- meaning you don't want to file bankruptcy, then don't give them access to anything.

The last you need is to be a victim of ID fraud- and you never know who you are talking to on the other end of the line.

I would tell them if they keep threatening you that they can take you to court and try to have wages garnish. Odds are good they won't do it and they are trying to scare you. Don't let them. The guys on the other end of the phone line are real jerks and it is their job to scare you.

Keep a very detailed record of when they call, how long the conversation lasts, and what was said. This way if they do send you to court you can prove you were being harassed illegally.

Answer 4

It isn't all that hard to get a garnishment, if you owe a lot of money. If you will never pay it off at 20 a month I can see why they have a problem with this. Interest is likely more then that, so your hole gets deeper and deeper.

Garishment is limited to 25% of your pay, so that may be cheaper for you then 150 a month, but I doubt it.

Also all law suits stay on your credit report, I would want to avoid telling potential lenders in the future that they will have to take you to court to get their money back.

Don't go for the auto pay from your account, they will accept the checks as long as you don't write any bad ones. If the person who calls gives you a bad time just ask to talk to their supervisor, they will be happy to make progress.

Answer 5

Well, for them to go for garnishment they will have to sue you. Lots of companies threaten to do this but some are only bluffing because sometimes it costs more to sue than what is collected.

I am guessing you are going to need to talk to a lawyer. I cannot tell you for sure what is going on. I looked up and it does look like Florida is a garnishment state, but it looks like there are limits to what they can do. The refusal to accept checks and to only allow them access into your account is kind of fishy. I have read of lots of these guys emptying out accounts the second they get access to them. You could close your accounts and tell them that you have none. That would be true. However, talking to a lawyer to help you is about the only option that really makes sense.


About statute of limitations, you may have been beyond that but your action of trying to pay back the debt will knock that out. Read this article about zombie debt. It will explain how the clock can be restarted in statute of limitation cases.

http://articles.moneycentral.msn.com/SavingandDebt/ManageDebt/ZombieDebtCollectorsDigUpYourOldMistakes.aspx?page=2

Answer 6

Can they dictate how you pay them? Yes, but you don't have to accept it.

Can they garnish your wages? They can, but first they´d have to sue you in court and win the lawsuit. Then they´d have to file for the garnishment. So this is a long process.

Better yet, you might try to get a consolidation loan, and pay off all of your old debts, including the idiots at the collection agency. Possible sources for that are

Bankrate.com:

www.bankrate.com

or Prosper.com

https://www.prosper.com/groups/group_home.aspx?group_short_name=FSC

Good luck!

Answer 7

Yes to both questions. They DO have a right to demand a specific form of payment, and they CAN garnish. That being said, you were still smart to refuse to allow them direct withdrawal. Lord only knows that they would drain your account of every penny in it, disregarding any agreement you had made with them. Frankly, you are better off with garnishment, since they are limited by court and law to a specific percentage of your income. At least you will know what you will be paying out of every check.

A note to Jodie. I beg to differ with your response. The fact that payments are being made does not negate the collection agency's right to seek a judgment, nor to garnish.

Answer 8

GET A LAWYER!!!!! That's all I can really tell you. If Florida is a garnishment state, then thats what they will try to do, and odds are they will be successful. Don't try to be cheap and our not saving money if you don't, only a lawyer can really help you to get out of this one with your credit in tact. A lawyer isn't cheap, but its cheaper than not getting a lawyer.

And don't get suckered into consolodation, that will often cost you more in the end than you would otherwise.

Answer 9

It was good that you told them that you would talk to a lawyer. There are services out there that will allow you to have an attorney on call 24/7. You wouldn't even have to deal with them your attorney would and you would be able to pay what you want to pay and nothing more.

Answer 10

Keep making payments, whatever you can afford. As long as you are making payments, they can't take you to court and get a judgment. Once they get a judgment they can start garnishing your wages, but not before.