Credit card debt is unsecured debt. If a borrower ceases to make his scheduled payments, the credit card company cannot claim any of his personal property in lieu of those payments. The creditor, however, has a legal right to the debt and will exercise all reasonable options in an attempt to recover it.
Many debt collection companies record calls to ensure quality and compliance in their operations. This practice has proven a double-edged sword, as it makes agencies possibly vulnerable to liability under state statutes regulating call recording. California’s call recording statute may be the most draconian of all: it imposes civil liability of $5,000 for each call surreptitiously recorded in violation of the statute.
Security is a major topic when it comes to our collection systems and how integrated they have become in all aspects of our business. We now grant employees, clients, and debtors access to our systems in and out of our offices. As we hear of data breaches more and more often, the numbers of consumers that are affected are no longer in the thousands but in the millions. We must continue to build our systems with security as the prime objective instead of as an afterthought.
Borrowers who seek to consolidate their debts today have more options than ever before. Student loans, credit cards, car payments and other types of debt can be moved around in many different ways to get ahead of the curve. Knowing the pros and cons of each strategy can help you determine which path is best for you and save you thousands of dollars – and your credit score as well.What to Expect When You Have a Collection Account
If you owe on your credit cards, no legal action can be taken until you fall behind on your payments. At that point, your creditor will note your missed payments on your credit report, lowering your credit score. After about six months, your creditors will charge off your debt, which is another negative mark on your credit report. After a charge-off, you are still liable for your debt and may face lawsuits, judgments, wage garnishments and liens.
The main aim of the new National Credit Act (NCA) is to prevent over-indebtedness and to provide more accessible structures for dispute resolution. Among other solutions, the NCA aims to achieve this by creating a more transparent platform, which bodes well for debtors and creditors alike.
The Fair Debt Collection Practices Act regulates what debt collectors can and cannot do as they attempt to collect from you. Although the federal law protects you in many ways, it does not include provisions for making debts disappear or expire. That means a debt collector could pursue you for the rest of your life for a debt that you legally owe
A credit score is a number that summarizes your credit history. Before you borrow, credit scores are used to determine eligibility for PLUS loans, and interest rates for private loans. You can request a copy of your credit report and follow your credit score.