We know that our national debt is growing as rapidly as the markets. Statistics reveal that Americans are having $18.5Tn in terms of personal debt and that has been going up at a rate of almost $500Bn every year. This should be accounting for 2.5 percent of the GDP that is expanding at even less than 2 percent and so we find that our total economic growth is actually debt-financed, as per the https://www.huffingtonpost.com.
The debtor is very much at fault if he has not paid off his debts but his rights as a debtor need to be protected. He must get a fair deal despite defaulting. Now, if you have been defaulting on your credit card debts and not bothering to clear the repayments, then you have overwhelming debts to get rid of. There is several consumer protection and debt relief laws in the U.S.A. and these laws are not placed strategically to relieve the debtors of their duty and responsibility to pay off whatever amount they owe.
The creditors have the right to call the borrower and request payment and if necessary sue them for defaulting in the court. However, there exist several malpractices that are pretty abusive at times. That is primarily the reason why the need arose for implementing a few consumer protection laws by the federal government against the creditors and collection agencies. These laws would be safeguarding the interests of the debtors when the creditors keep making harassing phone calls to compel them to make all the repayments at once.
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The Role of FDCPA
The FDCPA is supposed to be the abbreviation used for the Fair Debt Collection Practices Act. The fundamental basis of this law essentially is the protection of the debtors and consumers from unnecessary harassment by the collection agencies and the creditors. This law, however, does not mean to disregard the collection process. However, it introduces a few strict rules and regulations to make sure that the collection process does not become abusive. Let us explore some very crucial facts that are very much within the purview of FDCPA:
- Irrespective of the fact that you owe an outstanding balance or amount to the creditor, you still should be treated respectfully and fairly by the creditors and collection agencies while the collection process is in progress. It is your right to demand fair treatment.
- The collection agency or the creditor has the right to call you and inform you about their identity and purpose of the call, mention the name of the creditor on whose behalf they are calling you, and remind you about the exact amount you still owe to them. They must provide their contact details for you to contact them when you are ready to pay back the pending dues.
- You have the full right to inform the collection agency or the creditor how and when they could contact you for further discussion. You have the right to request the collectors to talk to you alone and not harass other relatives or family members with abusive collection calls. As per the law, the agency is actually prohibited from making calls late at night or early in the morning.
- Rights are reserved for the debtors to ask the collection agency to stop making the calls irrespective of the outstanding debts. Even while you are in debt, you do have the consumer right to request stopping all sorts of correspondence and phone calls that disturb your peace of mind regarding debt repayments. The collectors have the right to send a ‘notice of consent’ to you.
- You could look for more protection by filing a complaint about abusive practices to the FTC and all your correspondence must be in the written format. You may request for the precise reference number of the collection call.
- Avoid paying anything that you do not remember about owing. Sometimes mistakes are common. You may be asked to pay loans that have already been repaid or consolidated or settled. You have the right to request an accurate breakdown of interest rates and fees.
- You must not totally ignore a collector. It is essential to listen and respond to them just once at least, just to tell me that they must stop calling you.
- You have been safeguarded against any profane language, abusive behavior, and threats so you must not tolerate any of these and take things lying down.
- You must contact the CFPB or the Consumer Finance Protection Bureau for filling a complaint against your creditor or the collection agency.
What Is TSR?
You need to be fully aware of TSR while looking for some debt relief. TSR is the abbreviation of Telemarketing Sales Rule. This is supposed to safeguard the interest of the debtors against the debt consolidation or debt relief companies that take undue advantage of the debtors. This law would be safeguarding debtors in three chief areas of concern.
Upfront payment is banned. It is illegitimate to ask for an advance payment or accept any kind of payment without delivering the precise relief service that had been promised.
A fully-written and clear debt management plan or agreement reached between the debtor and the creditor must be submitted.
You may create an escrow account for the customer or debtor to deposit the necessary service fee that was demanded by the debt relief or Debt Consolidation Company. The creditors could collect the money only when the debtor is fully satisfied with the company or meeting a pre-agreed milestone. Browse the Internet for debt consolidation reviews to take the right course of action.
What is TILA or Truth in Lending Act?
TILA or Truth in Lending Act is supposed to be a federal law which clearly lays down precisely the minimum standards required for information within a contract issued by the creditor. There are certain mandatory disclosures that require to be made to the debtor before the contract could be executed. The disclosures include the minimum monthly payment, the finance amount, annual percentage rate, and the exact number of your monthly payments to be made.
Conclusion
If you wish to gain financial freedom and get rid of your debts using debt consolidation or any such debt relief methods, you must, first of all, understand the existing laws and the rights that protect your interests. You need to enhance your knowledge of consumer protection. Devote more time to doing some research on the existing laws that would be safeguarding your rights.