Debt Consolidator Information

U.S. Bankruptcy Code imposes something called an automatic stay the moment that a petition for bankruptcy is filed. The automatic stay will usually halt the commencement, enforcement or appeal of actions and judgments against a debtor from the creditors they owe money to that are attempting to collect these debts incurred prior to the bankruptcy petition. In addition, the automatic stay protects property of the bankruptcy estate itself from collection actions and proceedings.

If a creditor violates the automatic stay their actions are voided out. Any violation of the stay might cause the violating party to have damages assessed to them. But, like every complicated law, there are exceptions. A creditor might be allowed to take their collateral if they obtain permission from the court first. They’ll get this by filing a motion for relief from the automatic stay.

The court will either grant the motion or provide security to the creditor, ensuring that the value of their collateral won’t decrease during the stay. Without the protection of the automatic stay creditors could hypothetically race to the courthouse in order to improve their positions against a debtor. If this happened, and let’s say that a debtor’s business was facing just a temporary crunch, it might not survive a “run” by creditors when their business could otherwise be salvaged. A run may also result in waste and it might be unfair to similar creditors that are owed money too.

There are three kinds of avoidance actions, and all of these are intended to limit the risk of the legal system prompting the downfall of a financially unstable debtor who hasn’t yet declared bankruptcy. The bankruptcy system will generally reward creditors who continue extending financing to debtors and will discourage creditors from ramping up their debt collection efforts.

Despite the fact that these rules are seemingly simplistic, a number of exceptions exist for each type of avoidance action.

Mallory Megan is employed by a debt collection agency. Also, she does stories on business and finance, the credit industry, and collection agencies.

It is true that Americans with outstanding debts will usually suffer from a number of punishments. Collection letters, phone calls, unfavorable credit scores and a chance to wind up in court are examples of retributions for non-compliance.

However, a new trend that is growing is debtors suing debt collectors first. Any violation of the Fair Debt Collection Practices Act can be valid reason alone to take a collector to court. It might be true that in a declining economy suing a debt collection agency instead of paying off what you owe may be your only choice. There were 8,347 consumer lawsuits filed against collection companies in 2009. That’s a 55 percent increase over 2009 and double that number filed in 2007.

A portion of the debtors are plaintiffs suing for the first time, who suddenly find themselves unable to pay debts, and they feel that they have been wronged by aggressive collectors. Others compulsively sue. Usually these people have debts worth tens or hundreds or thousands of dollars. It is their hope that favorable judgments may put them on a “collections blacklist.” If he has sued 4 out of 5 debt collectors, debt collection agencies are probably going to want nothing to do with this strange character who puts time and effort into lawsuits when he could be looking for a sense of structure, and a job.

One example of a current lawsuit in action was from a woman who alleges that the collection agency never offered her proof it was entitled to collect. Seriously? Most debt collection agencies adhere closely to FDCPA laws, but even that law is foggy on certain practices such as whether it’s legal or not to leave a voice mail. Basically, the FDCPA hit the scene in the 1970s and needs desperately to be updated to today’s technology.

You might not want to know my opinion, but here it is. I was contacted by a debt collector who left a message on a third party phone, asking for me and letting me know she intended to collect a debt. This is a big no-no. I could have called her and given her hell, but I know why I have the debt and even though I may be broke, I intend to pay it back. To me, it seems like the economy is not getting better any time soon as the number of people who refuse to hold themselves accountable for financial decisions they made in the past grows. I hate to say it, but a debt is a debt, whether we are in a recession or not.

Mallory Megan works for a debt collection company. She also writes pieces on business and finance, consumer spending and debt collection

Collection company American Profit Recovery recently began a fund raising effort so that they can assist those trying to deliver relief to the Haiti earthquake victims. American Profit Recovery has chosen the Saint Rock Haiti Foundation which is a charity that provides medical care for the people of Haiti.

There are three different ways in which the debt collection company will raise funds. One will be the dedication of five percent of the revenue from their largest trade show. The cash will come from all sales at the show in addition to any that come in until the end of February.

Employees are given the option to contribute by paying to have the chance to dress casually each Monday in February. Food that is bought at their three locations will also go directly to Saint Rock Haiti Foundation.

American Profit Recovery chose Saint Rock Haiti Foundation after one of their employees brought the organization to its attention. And by picking this charity, it will have the opportunity to apply to the Grand Lodge of Masons over in Massachusetts to match their donation, doubling fund raising efforts.

American Profit Recovery is a collection company with offices in North Carolina, Massachusetts, and Michigan. It was founded in 2004. APR concentrates on the collection of third party debt in professional industries such as banking, trades, medical and dental, and lawn care.

APR has a large interest in good business practices and diplomacy with debtors. They work to keep the relationship between client and consumer intact; their goal is to keep the business relationship going.

Recent studies suggest that collection companies that train their collectors in empathy are the latest trend and the most successful. If someone is being contacted by numerous collection agencies, they are more likely to work with the collector that has shown compassion. More debt collection agencies could take a lesson from APR and start giving back to the community.

Mallory Megan works for a debt collection company and does pieces on consumer spending, business, finance, and debt collection.