When collectors hound over dealt-with debt, what to do?
Do you believe in ghosts? Everyone knows they don’t exist, but there can be circumstances in which things that we thought were long gone can come back to haunt us. Zombie mortgages in the wake of the most recent recession serve as one clear example of this phenomenon.
When so many homeowners in Georgia and the rest of the country fell into arrears on house payments because of financial crises, foreclosure notices often followed. With loss of hearth and home staring them squarely in the face, many people vacated their premises.
Only later did they find that sometimes the bank never went ahead with foreclosure. The deed remained in the original homeowner’s name and so did all the responsibilities that go along with that, including taxes, fines and penalties as properties slipped into disrepair.
A similar dilemma can develop if a debt purportedly owed by a consumer gets sold off to a debt collector. Sometimes the debt is legitimate. Sometimes it isn’t. Regardless of the actual status of the debt, however, collection agencies can be unrelenting in their efforts to collect. If they have what they believe to be a proper judgment in hand, they may move to freeze bank accounts, garnish wages, destroy credit ratings and exercise other undue pressure.
In the face of such anxiety, it can be easy for a person to succumb to despair, even though options for relief may exist. The way to find out what choices may be available is to talk with an attorney skilled in this area of the law.
Recognizing that the sell-off of debt to collectors, both legitimate and not, is on the rise, the Center for Responsible Lending has gone on an offensive. The CRL says it’s particularly concerned about research showing that the more than 90 percent of collections pursued by agencies in 2009 had no documentation at all to prove the debts actually existed. Still, collections were pursued.
CRL says that to be sure debts are legitimate, federal and state governments should get more involved in the process. The group says such oversight is crucial to fixing predatory collection practices.
Source: ConsumerAffairs, “Consumer group urges increased debt collection oversight,” Mark Huffman , May 2, 2014