Bankruptcy Lawyer Bryan W. Stone answers the question: “Does my spouse have to file bankruptcy if I do?”
Divorce and separation are common reasons why people file for bankruptcy, according to a 2019 study. Can one spouse file for bankruptcy without the other in North Carolina? Can you choose between a joint and individual bankruptcy filing if you are married?
Charlotte Bankruptcy Lawyer Bryan W. Stone of Arnold & Smith, PLLC answers the question “What is a bankruptcy discharge?”
Humberto Soto thought the $6,411 Chase credit card debt he incurred before his 2012 bankruptcy had been discharged, but when the 51-year-old former hospital worker tried to rent an apartment in January, a housing agency ran his credit and spotted the debt.
Soto called JPMorgan Chase, who held the debt. Chase told Soto he either had to pay or else lose the apartment. Soto called his lawyer, who called the housing agency. Soto got the apartment, and he did not have to pay Chase.
Soto’s experience is playing out by the thousand across the United States, with large financial institutions failing to extinguish debts that federal judges have ordered discharged in bankruptcy courts. By keeping the debts alive, banks are “essentially forcing borrowers to make payments on bills that they do not legally owe,” according to the New York Times. The Times calls the not-dead-yet debts “zombie” debts.
The banks say they comply with all federal laws regarding debt collection and sale of debt holdings, but lawyers in the United States Trustee Program are investigating Chase, Bank of America, Citigroup and General Electric’s financing arm, alleging that the institutions are effectively holding consumer credit reports hostage until borrowers pay—even borrowers whose debts have been discharged through bankruptcy.
Anyone who has ever had the misfortune of falling behind on bills knows how embarrassing and frustrating calls from debt collectors can be. Though there are regulations concerning when debt collectors can contact debtors, the fact is not every company follows the rules. Debt collectors that are eager to make their quotas often skirt the laws by illegally harassing debtors. Rather than feel powerless, read the following for advice on how to combat overly aggressively debt collectors.
Fair Debt Collection Practices Act
Thankfully consumers were not left to fight debt collectors on their own. The Fair Debt Collection Practices Act was written to lay out consumers’ rights when dealing with collectors and provides steps for what consumers can do to stop collectors that go too far.
FDCPA regulates when debt collectors can contact consumers
One of the most important things to realize is that debt collectors are limited by law in when they can contact consumers. If you’re getting calls late at night then collectors have violated the clear terms of the FDCPA and you have grounds to take action against them. The FDCPA says that debt collectors must not make contact with consumers before 8 a.m. or after 9 p.m. unless you specifically asked them to do so. Debt collectors are also restricted from contacting you at your workplace if you have informed them that you are not allowed to take calls at the office.
Collectors cannot humiliate consumers
Just because you may have fallen behind on their bills does not give collectors the right to embarrass you in front of family or friends. The FDCPA explain that debt collectors are not allowed to contact third parties such as neighbors, bosses or family members except to obtain contact information for you. When they make these calls they are not permitted to reveal why they are trying to contact you, an important regulation that can protect your privacy. This particular regulation means that debt collectors cannot leave voicemails mentioning a debt.
Good news was announced earlier this week by the Consumer Financial Protection Bureau (CFPB), which said that it would begin cracking down on debt collectors across the country to ensure that they are doing their jobs in accordance with the law. The financial regulator said that it was especially interested in investigating debt collectors to make sure they are going after debtors for the right amounts of money as well as ensuring they are doing so without illegally hassling them.
The CFPB intends to accomplish its goal thanks to a series of new regulations that it says are sorely needed. The CFPB points out that existing regulations concerning the oversight of debt collectors have been in place since the late 1970s and are woefully out of date given technological advances. Examples include how some debt collectors are using text messages or social media to target and harass debtors. To skirt rules about calling at certain times, these unsavory debt collectors have resorted to other means of communication not covered under the outdated laws.
Currently, the Fair Debt Collection Practices Act says that collectors should attempt to contact people between 8 a.m. and 9 p.m. local time and avoid annoying, abusing or harassing consumers. However, experts have pointed out that this language was written more than 30 years ago, before email or cellphones even existed. The CFPB is now asking the public, as well as industry officials, to provide feedback over the next few months about whether additional rules should be added to keep pace with technological advances.
One suggestion is to follow the example of states like Massachusetts which caps the amount of times a consumer can be contacted about a debt during any given week, regardless of the means of communication. Massachusetts’ law says that debt collectors are only allowed to communicate regarding a debt twice in one week, including calls, texts or voicemails.