If you live in North Carolina and owe money to someone, they may eventually turn to a debt collection agency to try to get the money from you. This can be a stressful experience, but it is important to understand your rights and what the process entails.
Types of Debt That Can be Collected
Two different types of debt can be collected: secured and unsecured debt. Secured debt is backed by collateral, such as a car loan, where the car can be repossessed if you fail to make payments. Unsecured debt is not backed by collateral, such as credit card debt.
What Debt Collection Agencies Can Do
When a debt collection agency takes over the debt, they will first try to collect the debt from you by contacting you to arrange a payment plan. They may also try to negotiate a lump sum payment. If you are unable to pay the debt, the debt collection agency may take you to court.
If the debt collection agency wins the lawsuit, they can get a judgment against you for the debt. A judgment is a court order that requires you to pay the debt. Once a creditor has a judgment against you, they can take steps to collect the debt from you. Usually, the most common way to collect a debt is to garnish your wages. This means the creditor can take a portion of your paycheck to pay off the debt. However, laws in North Carolina protect consumers from wage garnishment.
Most unsecured debts in North Carolina, such as medical bills and credit card debt, cannot be garnished from your paycheck. However, a creditor can put a lien on your property or levy your bank account. If they put a lien on your property, you won’t be able to sell it or, in most cases, even use it unless you have paid off the loan. If you have money in your bank account, by levying your bank account, the debt collection agency can take that money to pay off your debt.
What Debt Collection Agencies Can’t Do
It is important to know your rights when dealing with debt collectors. In North Carolina, debt collection agencies must follow certain rules when trying to collect a debt from you. These rules are designed to protect you from unfair or abusive debt collection practices. Here are a few things that debt collection agencies are not allowed to do under North Carolina laws:
- Contact you repeatedly outside normal waking hours (before 8:00 a.m. or after 9:00 p.m.)
- Call you at work if you’ve told the debt collector or the creditor that you’re not allowed to receive calls at work
- Use profanity or threaten you
- Call you repeatedly or continuously
- Misrepresent the amount of money you owe
- Tell you that you’ve committed a crime
- Falsely claim to be a government representative
- Say that they’ll seize, garnish, attach, sell your property, or take your wages unless they’re going to do so
- Threaten to take action that they can’t legally take
- Try to collect interest, fees, or other charges on top of the amount you owe unless the contract or state law allows it
- Deposit a post-dated check prematurely
- Refuse to give you the name and address of the original creditor if you ask for it
If you feel that a debt collector has violated your rights, you can file a complaint with the Consumer Financial Protection Bureau with the help of a debt collection lawyer. A debt collection lawyer can also help you stop harassment by a debt collector. If you’re being harassed by a debt collection agency, your debt collection lawyer can send a “cease” letter to them. This letter tells the debt collector to stop contacting you. Once the debt collection agency receives the cease and desist letter, it can only contact you to:
- Tell you that it’s going to stop contacting you
- Notify you that the debt collector or creditor plans to take a specific action, like filing a lawsuit
A cease and desist letter is not a payment agreement. If you want to negotiate a payment plan or settlement with the debt collector, you can send a separate letter with the help of your debt collection lawyer that asks for this. If a debt collector violates the rules, your debt collection lawyer can also help you sue the debt collector. You may be able to get money damages and have the debt collector pay your attorney’s fees.
Legal Help You Can Trust
If you are being harassed by debt collectors, don’t hesitate to contact GPS Law Group. Our team consists of leading debt collection lawyers who can help you stop the harassment and get the debt collectors off your back. We will review your case and help you determine the best course of action. Call us at (704) 549-1950 or use our online contact form to send a message and set up a free consultation.
We serve Charlotte, North Carolina, and the surrounding communities.