When you are in debt, it can be incredibly overwhelming. However, many are unaware of what it means when the debt moves to collections, despite the fact they know it’s inherently negative. As such, if you have had a debt transition into collections, understanding what this means and what your rights are in these times is critical. The following blog explores what you should know about these matters and why you should consider connecting with a Los Angeles, California debt defense lawyer who can assist you through these complicated matters.
What Does It Mean if a Debt Is in Collections?
When a debt moves to collections, it essentially means that the original creditor has chosen to sell the debt to a third-party debt collector. These individuals or organizations often sell debt for a fraction of the value of the debt.
Creditors who cannot successfully contact or pursue a debt often choose to sell rather than continue to pursue the funds as they have no indication that you will repay the debt and must focus resources elsewhere. When you miss a payment, the creditor will make numerous attempts to contact you about the debt. After thirty days, the debt can move to collections, but many creditors will try for at least six months to recover the funds they are owed.
Do I Have Any Rights When My Debt Goes to Collections?
Many consumers assume that because they owe a debt they no longer have rights regarding anything to do with that debt, which is far from the truth. In reality, you have many protections as a consumer, even if you owe funds and those funds have transitioned to collections.
One of the most critical protections consumers have when they are being contacted by a debt collector is the Fair Debt Collections Practices Act (FDCPA). This is a set of regulations that third-party collectors must follow when interacting with debtors. Violations of this act include, but aren’t limited to, the following:
- Calling repeatedly in a short period of time
- Calling outside of permitted hours (before 8 a.m. and after 9 p.m.)
- Talking to others about your debt
- Failing to identify themselves as a debt collector
- Pretending to be a member of law enforcement
If the debt collector violates any of the rules established by the FDCPA, you can file a claim against them to recover statutory damages up to $1,000 per violation.
Even when a debt moves to collections, it’s important to understand that you are still protected as a consumer. As such, if your rights are violated, the team at Los Angeles Legal Solutions is ready to assist you. We understand how complicated these matters can be, which is why we will do everything in our power to help guide you through these challenging times. Connect with us today to learn how we can fight for you during these challenging times.
