Collection & Credit Card Companies and the Lies They Tell
I know this may come as a shock to some, but Credit Card and Collection Companies will tell you “lies” to try to scare you into making a payment they are also down-right rude and insulting on several occasions.
Here is the reality….take care of you and your families’ needs first. People are so concerned about “what will happen to their credit score” that sometimes leads them to make bad personal financial decisions. Take a step back and look at it this way….who cares about a computer generated number that constantly changes (Your Credit Score) if you don’t have enough money each month to buy food, make your housing payment or pay for medical or car insurance?
Don’t be bullied into making a credit card payment when you do not have the money to actually make the payment. Don’t take out a 300% pay day loan to make a payment on a different credit card.
Based on recent phone calls from clients, here seems to be the current trends in “lying.”
1. Lie Number 1: “If you don’t make a payment today, we will assign the debt to a 3rd party collection compay and then you will not be able to discharge the debt.”
This is FALSE therefore it is a lie and it seems to be very popular right now.
While it is true that certain types of debt is non-dischargeable in bankruptcy, it does not matter who owns the debt. The issue what type of debt is it? For instance, student loans, fraud, child support, drunk driving accident and other types of debt are not dischargeable. However, regular credit card debt (absent fraud) is dischargeable even if it assigned to a 3rd party collection agency.
2. Lie Number 2: “If you don’t make a payment on your credit card today, we will turn the case over to the prosecutor in your County and you could go to jail.”
This is FALSE therefore it is a lie. Once again, absent fraud by you, the debt is dischargeable and you will not go jail. I have been representing people for over 18 years and handled well over 1,800 bankruptcy cases and this has never happened.
3. Lie Number 3: “If you don’t make a payment on your credit card today, we can garnish your wages starting on Monday.”
This is FALSE therefore it is a lie. In Washington, in order to garnish a person’s wages, there must first be a lawsuit filed and a judgment entered. Without the judgment, a creditor cannot automatically garnish your wages unless it is a federally guaranteed student loan in default.
Here is an excerpt from the Washington State Attorney General Website: www.atg.wa.gov
A Collection Agency Cannot:
For more information, read RCW 19.16.250, which identifies and describes in greater detail the prohibited practices of debt collection agencies. A copy of Washington state laws is available at most public libraries.
Please don’t take the above to think that creditors cannot take actions to collect the debt. Since January 2010, we have seen a dramatic rise in lawsuits filed quickly by creditors to attempt to obtain judgments as soon as possible. If you do not respond to the lawsuit correctly and file the required pleadings with the court, the creditor can obtain a judgment against you in 20 days. At that point, creditors can garnish wages, bank accounts and file liens against real estate.
If you find yourself being harassed by creditor calls and don’t know what to do, please contact our law firm or visit the Attorney General website.
About the Author
Chris served on the Board of Directors for Habitat for Humanity
Seattle/S. King County for 10 years and served as Vice President
of the organization during part of that time. Read More