St. Louis Bankruptcy Lawyers Blog

No, they cannot legal do so, unless these amounts were expressly authorized by the original agreement between you and the original creditor. That doesn’t mean that the collector won’t add such costs into its attempts to collect. But doing so is a violation of federal law.

The rules that govern how a debt collector can collect on a debt are laid out in black and white by the Fair Debt Collection Practices Act (FDCPA). This federal statute spells out exactly what a collection agency can and can’t do. One of the things it is prohibited from doing is adding additional charges such as any interest, fee, charge, or expense incidental to the principal obligation. So when you look at the collection letter that the company sent you, and it provides you with a breakdown of the amount that is due, you should look very closely at whether or not such costs have been created. If they are, this will at the very least explain why a $300 debt has now turned into a $1,500 avalanche.

Assuming that the original creditor did not explicitly give the collection agency permission to add such costs in its contract/agreement with them (and they almost never do), then asking you to pay for them is a violation of the FDCPA. And of course proving that the violation has occurred is as simply as providing your attorney with a copy of the letter you received. Most of these kinds of violations carry a fine of $1,000, which must be paid to you by the debt collector. The other nice component of this law is that the collection agency must also pay your attorney fees. This means that when you hire a FDCPA attorney to go after the collectors, you don’t have to pay anything up front.

Yes, they can. But if they leave a voice message on your phone, they have to follow very specific rules set out by the Fair Debt Collection Practices Act (FDCPA). If those rules are not followed, then a violation of the act has occurred, and you will be entitled to damages.

To begin with, it is always important to point out that if the phone the collection agencies are calling is your mobile/cellular device, that in and of itself is a federal violation of law. The collectors are explicitly prohibited from contacting you on your cell phone. Each time they call your cell phone, it is a violation of the Telephone Consumer Protection Act (TCPA), and the normal damages awarded for such a violation is $500 per call to your cell phone. But regardless of whether or not they call your cell phone or home phone, the collection agencies must abide by the law when they leave a voice message.

Whenever a collector leaves a voice message for you (either on your cell phone or home phone), he/she must identify who they are, why they are calling, what company they are with, the fact that they are calling about a debt, and that they are a debt collector. All of that must be disclosed in the message. So an example of a message that complies with the law would go something like this: “Good morning. This Jim Taylor. I am with Debt Collectors Are Us. I am calling you in regards to a debt that you owe that my company is trying to collect on. If you could please give me a call back at 1-800-000-0000.” Now if are sitting there scratching your head and thinking, “I’ve gotten a ton of messages from collectors, but none have ever left a message with that kind of detail,” then you are one of millions of people whose rights have been violated.

Not necessarily. It depends on two things: 1) Whether or not you actually want to keep your home; and 2) If you do want to keep your home, whether or not there is a substantial amount of equity in the home. The answers to these questions will determine what your options are, and what kind of bankruptcy you should file.

If you qualify for a St. Louis Chapter 7 and you wish to keep the home, it is possible to retain the asset. So long as there is no equity in the home, then you can simply reaffirm the loan, and continue making regular monthly payments on it (while getting rid of your unsecured debts). But the Bankruptcy Trustee (the person assigned to your case by the government) will want to know if there is any equity in the home. If there is substantial equity in the home (above any exemptions that can be applied), then it is possible that the Trustee will want to liquidate the asset. So for example, if you own a home that has a loan against with a balance of $100,000, and you believe that the fair market value (the amount that the home would actually sell for) is $150,000, then there is equity of $50,000 (150,000 – 100,000 = 50,000). The government then gives you a $15,000 exemption to cover any equity that may exist in the home. This would reduce the equity (on paper) down to $35,000 (50,000 – 15,000 = 35,000). Having $35,000 worth of equity in the home is more than enough for a Chapter 7 Trustee to go after the asset. But if the goal is to keep the home, then there is an alternative.

If you file a St. Louis Chapter 13 bankruptcy, it doesn’t make any difference how much equity exists in the home. Filing such a bankruptcy protects all secured assets (like a house or car). This type of bankruptcy is especially helpful if you are behind on your mortgage payments, or even have a pending foreclosure. A repayment plan is set up in which you make monthly payments to the Trustee, who then disperses those funds to various creditors (arrearage on the mortgage, car loan, tax debt, back child support, etc.) And of course, you get to keep the home. There is even the possibly (depending on your set of circumstances) of getting your unsecured debts discharged as well in a Missouri Chapter 13.

That depends on what you believe to be ‘a lot’ of debt. For some people, once they reach several tens of thousands in credit card, several thousand more in medical bills, a few hundred in payday loans, and when many of the creditors are starting to sue of the existing debts. For others, they are able to see the ‘writing on the wall,’ and recognize that the example given above is in the near future. And still others will wait years before they even consider filing for a Missouri bankruptcy, enduring endless phone calls and harassment, because the mere thought of doing such a thing is devastating. Even if these situations do not precisely fit the description of where you are in life, you probably fall somewhere in between.

The main thing to keep in mind is that, regardless of how much debt you currently own, the pressures of dealing with it can be alleviated immediately upon filing for bankruptcy. No more phone calls, threatening letters, law suits, or any collection activity whatsoever. Once the debts are discharged, you will have moved into what the court describes as a ‘fresh start / clean slate’. This discharged literally wipes the slate clean, and gives you the chance make a fresh start in life by moving forward.

And opportunities to rebuild your credit rating and/or score will be immediate. Most individuals believe that filing a St. Louis Chapter 7 bankruptcy or a St. Louis Chapter 13 bankruptcy will ruin their chance at ever reestablishing a good credit history (and that they’ll never again be able to buy a car, or a house, or even purchase a pair of socks at JC Penney). But the exact opposite is true: Within a couple of years after filing for bankruptcy, you will generally be in a position to make purchases such as house. And improving your credit rating by more immediate methods is available, too, such as getting another credit card.