Debts In A Divorce Decree

QUESTION: I financed a car with my ex-wife. The divorce decree states that the vehicle and the debt for it are hers.

She has not been paying on the auto loan, and it is hurting my credit. Do I have any legal recourse?

ANSWER: From a credit/debt rights perspective: Notifying the lender and/or the credit bureaus that your ex spouse was given the car and the car note does NOT relieve you from the liability. Family courts and divorce-court judges cannot force the bank (not a party in the divorce lawsuit) to agree to drop you as liable on the car note. Unfortunately, most divorce attorneys do not go into that sort of detail with their clients.

The only way you can save your credit is by making the payments yourself or encouraging your ex-wife to sell the car. If you make the payments yourself, you will probably have recourse to go back to family court and demand that your ex-wife reimburse you. If you convince your ex-wife to sell the car, any deficiency between the amount owed less the amount recovered through the sale is still your liability.

I would strongly recommend you do everything in your capacity to avoid the vehicle being repossessed. From a credit/debt perspective, a repo is even worse than a late payment or two.

On another note: if the vehicle does get repossessed, you should anticipate getting notice from the lender before the car is sold. That notice is required by Texas law and you should allow a consumer rights attorney to have a look at it to determine that your rights have not been violated. The Texas Finance Code has some terrific relief (damages) for consumers when that letter following repossession is defective.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Statute of Limitations On Unsecured Debts

QUESTION: I understand there is a statue of limitation of 4 years to collect unsecure debt (say, credit card debt). The creditor sold the debt to a collection agency at the end of the 4th year of the debt. My question is would the clock reset on this debt account? I meant a 4 years statue of limitation starts all over again with the new collection agency? what if this collection agency now sold the debt to the second collection agency after number of years unsuccessfully to collect, and the circle repeats itself. What rights as a consumer of unsecure debt has to get this old debt off the record for good?

ANSWER: It sounds like your question relates to credit reporting more than potential lawsuits to collect the debt.
The clock for the statute of limitations on debt starts at the date of default. (Some creditors like to argue the clock starts from the date of chargeoff – -180 days after default.) Unless YOU make a payment, nothing else will restart that clock.
The statute of limitations to collect the debt in court is 4 years.
The amount of time that the debt will appear on your credit report is 7 years from the date of default. It makes no difference how many times the debt was bought and sold, it is still seven years. If you make a payment to any debt collector or debt buyer along the way, then the clock starts all over again.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Defaulted PayDay Loan

QUESTION: Can I be sued in the Texas for a defaulted online payday loan?

I taken out a few payday loans online and pretty much got in over my head paying them back ! Can I be sued in Texas?

ANSWER: Most payday lenders do not sue in Texas. Having said that, they are certainly entitled to sue you if you defaulted on a loan.

I would be curious to know who is threatening the lawsuit and whether they are a “usual suspect” – – the kind of payday lender that actually does file suit in Texas. If they are not customarily in court, then their threat is illegal, and possibly a violation of either the Texas Debt Collection Act and/or the Federal Fair Debt Collection Practices Act. The collection industry for payday lenders is infamous for being abusive. I would suggest you keep track of all collection phone calls and keep all of the collection letters.

If the threat to sue is in writing, I would suggest you forward a copy to a consumer rights attorney. If the threat to sue is made verbally, you might still want to talk to an experienced consumer rights attorney who can do a bit of research and find out whether this collector is blowing smoke, or not.

Finally, you might want to have a look at your credit bureau reports through www.AnnualCreditReport.com (That is where you can get your credit reports for free.)

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Not Showing Up To A Civil Suit Court Appearance

QUESTION: What would happen if I do not show up to a hearing concerning credit card breach of contract?

I am a house wife who made regular payments until my husband stopped giving me any money to pay on credit card and anything else at all . I have no income at all to work with and had to move out of our house and in with family just to stay alive due to him canceling my medical insurance and not buying food for the house now I am being sued.

ANSWER: The collection industry can be ruthless. They don’t care what your circumstances: if they can legally collect against you, they will.

Depending on all of the circumstances surrounding your finances, you may want to consider bankruptcy. Bankruptcy will stop the lawsuit against you dead in its tracks.

Otherwise, I suggest you do everything possible to defend yourself. If you/family can afford to hire a consumer rights attorney, that’s your best bet. The creditor/plaintiff is likely to get a judgment against you by default. Even if you cannot afford to pay for the judgment now, the judgment-creditors are patient: they will wait until you find employment, re-marry, gain an inheritance, or win the lottery. Meanwhile, a judgment on your credit reports can be devastating. You should do everything you can to avoid having a judgment entered against you.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Identity Theft & The IRS

QUESTION: A company that I used to work for opened a PayPal account using my name and SS #. Is this identity theft? 

A company that I used to work for opened a PayPal account using my name and SS #. I stopped working there in 2008. I was contacted by the IRS that I had unclaimed income on my 2012 return and was asked to pay over $10,000 plus interest. This was for monies payed by PayPal to the company and not to me. Although they have now admitted that the payments were sent to them and not me I am concerned that they may have used my name and SS# for other accounts which the IRS will come after me for. Should I – a) file a stolen ID report with the Police and b) take legal action against this company?

ANSWER: This sort of identity theft is becoming more and more common: the victim’s social security number is used to avoid paying taxes; or worse, the victim’s social security number is used to get access to a tax refund.

I would suggest you complain to the local police department. If you have sufficient information about the company that stole your ID, you may want to pursue it as well.

From a consumer rights perspective: I strongly urge you to check your credit bureau reports. You may obtain a free copy of your reports through www.AnnualCreditReport.com. If you find any suspicious information, you should immediately contact the credit bureaus and have a fraud alert issued. I would also suggest you contact a consumer rights attorney that can help you wade through the credit reporting mess. Most consumer rights attorneys do not charge an upfront fee for their time and will work on a contingency.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Getting Sued Over A Debt Already Paid

QUESTION: A collection agency says they’re going to sue me over a debt I already paid, I don’t know what to do.

I have a few emails of paid in full, but a couple of the companies didn’t send me anything, and when I tried to call them it says it’s no longer a working number.

ANSWER: First of all, I would suggest that you pull a copy of your credit bureau reports. You may obtain a free copy through www. AnnualCreditReport.com It is the only website that the Federal Trade Commission has approved of for a free credit report. You might find useful information on that website. Also, do you have old bank statements or cancelled checks to prove you paid?

If a third party debt collector is threatening to sue you on a debt that has been paid (whether you can prove it right now, OR NOT) then it seems your rights have been violated. I would suggest you contact a consumer rights attorney who has experience going after abusive debt collectors. They will probably want to look up this debt collector that is threatening to sue you. Specifically, they will want to see if this debt buyer is a common litigator; and also, they will want to find out if this debt collector has a surety bond on file with the Texas Secretary of State. If they do not, then this whole thing sounds like a scam- an illegal scam.

Keep in mind that the federal Fair Debt Collection Practices Act allows you to collect a statutory award, other damages, as well as your attorney fees. That is the reason why many consumer rights attorneys do not charge clients up front for their time. They can get paid for by the defendants. I strongly suggest you get your payment history together and call a consumer rights attorney licensed in Texas.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Removing A Dismissed Lawsuit From Credit Report

QUESTION: If you were taken to court for a broken lease and the case was dismissed is it possible to get it off your credit report?

My boyfriend left his old apartment a few years ago on account of his roommate who was unable to pay the full rent and left soon after. They were taken to court but the case was dismissed. Now we’re trying to get a house but the broken lease is still on his credit report. Is it possible to get it taken off because it was dismissed or does he still have to pay it?

ANSWER:The detail that is missing: what sort of dismissal was it? Your boyfriend needs to send a letter to the credit reporting agencies that are listing the broken lease. He will probably need to send a copy of that same letter to the past landlord disputing the negative information. If the dismissal documents from court are favorable to your boyfriend, he should attach them to the dispute letter. He should probably attach the dismissal documents in any event.

Your boyfriend should be gathering information about being declined or rejected from the new housing opportunity. In case the derogatory information on this credit report needs to be removed, and if it is NOT removed, then your boyfriend will have terrific grounds for a lawsuit against the past landlord and/or the credit reporting agencies under the Fair Credit Reporting Act.

If he needs assistance going through the dispute process, he should contact an experienced attorney. Most attorneys do not charge a fee for helping with the dispute letter writing process, or the resulting litigation, since the federal laws allow for fees to be paid by the defendants.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Sued By A Junk Debt Collector

QUESTION: Sued by a junk debt collector for $1500 on unsecured CC debt from 2011.  This clearly seems to be an attempt to get a default judgment by an attorney who expects that I will not answer. I’ll pay $250 to any licensed TX attorney who will answer on my behalf in the expectation that the junk debt collector will abandon hope due to the presence of an attorney and the weak claim. I seem to be one of many thousands of people who received court docs today judging by the quality of the summons. I’ve been doing research and this seems very easy to defeat. I’m wondering whether or not I should even bother to research how to defeat this when there might be an attorney willing to accept $250 to do it for me.

Last payment on the card was March 19th, 2011. I was served by someone in a $200 car on March 26th, 2015. The lawyer lives 300 miles away. The summons is very sketchy looking.

ANSWER: I don’t know who sued you and who their lawyers are. The debt buyer industry has been empowered over the last 2-3 years for a whole host of reasons. Yes, they may simply be interested in obtaining a default judgment. On the other hand, I have had many debt buyers – the likes of Midland Funding, Portfolio Recovery Associates, and many others up put a fight, even for very low balances. Their attorneys are in court with huge dockets all set for the same day: it is unlikely they would be coming to court for your case only. Plus, if this is a lawsuit in the Justice of the Peace court system, then the Texas Rules of Civil Procedure are severely relaxed, making it much easier to obtain a judgment.

You seem to be a terrific negotiator, considering your online bidding efforts here. Any lawyer that makes an appearance for you in an answer is on the hook for the entire case, not just the answer. An attorney who values their law license and their reputation will not get hired for the limited purpose of filing an answer and then asking the court to withdraw from your case. (I may be wrong, of course.)

If you fail to answer the lawsuit, or if you appear – pro se or through an attorney – and lose the case, the judgment will likely be significantly higher than $1,500.00, including interest, fees, court costs and attorney fees. The damage to your credit report, as well as the risk of post-judgment collection would be reasons for you to hire an experienced attorney.

 

Collection Case Dismissed For Lack Of Prosecution

QUESTION: I had a debit collection case that was dismissed for Lack of Prosecution.

The case was dismissed for Lack of Prosecution. I had filed a motion to reinstate the case and the judge said he wasn’t going to reinstate. so the  debt was sold to another collection agency. This was the 4 or 5 law firm that has come after me. What can I do to get this off my credit report? The debit type is a private student loan and this loan is NOT a FFELP.

ANSWER: There are two different issues here: the matter of the lawsuit seems to have been resolved if the case was dismissed. I understand that you have concerns that another debt buyer will sue you for it again. That is possible, although unlikely.

On the credit reporting side, you are encouraged to send off a written dispute letter to the credit bureaus and to everyone who ever tried to collect this debt. You should list all of the reasons why you dispute the negative information on your credit report. The fact that you were sued (and that the lawsuit was dismissed for lack of prosecution) does not qualify as a good reason to remove the debt from your credit reports.

If you dispute the debt with the present collector (and every collector beforehand) then they are prohibited by federal law from communicating information about the debt to yet another 3rd party. All of your disputes should be handled in writing, sent by certified mail, return receipt requested.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.

 

Reporting Credit Card Fraud

QUESTION: Do the local police bother to report a credit card fraud? I heard on another website that Federal Trade Commission rarely investigates a case that is less than $2000, right?

ANSWER: The Federal Trade Commission does not publish its criteria for actually enforcing consumer rights. In my experience, the FTC will only go after an individual or a company that has violated the rights of many consumers.

Generally, the local police may not have the resources to pursue fraud charges. Nevertheless, if you are the victim of any fraud or identity theft, you are encouraged to lodge your complaints with the authorities. I recommend that people complain to the following organizations:

1) your local police;
2) the Federal Trade Commission;
3) the Consumer Financial Protection Bureau;
4) the local Better Business Bureau; and
5) the Attorney General.

Ultimately, even if none of these organizations will do anything proactive for you, you will have a copy of the reports (or complaints) that you will need to send back to the credit card company and/or the credit bureaus to clear your name.

If the police report does not satisfy the credit card company, you might want to go one step further with an affidavit. Depending on the extent of damage to you, you may want to contact a consumer rights attorney to assist in drafting your affidavit.

This information is provided for educational purposes only. There is no attorney-client relationship with Karni Law Firm until a contract is signed by the attorney and the client.