Deos Law Blog

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It's Worth The Time to Check Your Credit Report

Your credit can influence how much your car payments are, whether you can rent an apartment or buy a house, how much you pay for insurance, and more. Credit is so important to every day life, yet many folks in and around Sacramento don’t keep a close eye on their reports. It can be difficult when there are so many other things we’d rather be doing. But monitoring your credit report is worth taking the time to send in a request for a free credit report once a year.

While you can order your free credit report online or over the phone, often the best way is to order it by mailing the approved form, certified for good measure, via US Postal Service. The form can be found on the FTC website, click here.

You are allowed one free credit report from each of the nationwide credit reporting agencies, TransUnion, Experian and Equifax. The most thorough way to monitor your credit for free is to request one report from one of the agencies every four months, alternating between them. This way you keep a fairly constant and consistent eye on your credit reports throughout the year.

Once you have them in hand, review them for accuracy. It can be difficult and tedious to read through all the details. But it’s worth it. If there are any inaccuracies, it is important to dispute them and make sure they get fixed. To learn more, click here.

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I'm being sued for a debt I barely remember. What do I do?

     A lot people have old debts, but debt collectors might not be able to sue you to collect on them. A statute of limitations is a law that limits the number of years collectors have to sue you in court to collect the debt. In California, the statute of limitations on a written contract is four years. After the statute of limitations has run, the debt collector can't sue you because it is "time-barred." 

Defend Yourself 

      If you are sued for debt that is time-barred, it is essential that you respond to the lawsuit. An attorney will know how to assert your rights and defend the lawsuit. There are number of ways to respond to the lawsuit and it is important to do so timely. If you ignore the lawsuit, the debt collector will most likely get a judgment against you. If that happens, they may be able to garnish your paycheck or tax refund or empty your bank account.

Assert Your Consumer Rights

       It is against the law for a debt collector to sue you or threaten to sue you for a debt that is time-barred. Under the Fair Debt Collection Practices Act (FDCPA) and the Rosenthal Act (California's version of the FDCPA), consumers have rights and remedies, including statutory damages and they have to pay your attorney fees when you win. Hiring an experienced consumer lawyer can make the process go much more smoothly and more likely to end in a good result. 

        For more information, click here or call [phone].

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Report: Debt Collectors Continue to Engage in Unfair Practices

Many consumers in the Sacramento Valley are very familiar with the business practices of debt collectors. Debt collection abuse happens all too often, whether it be harrassing phone calls, threats of criminal prosecution, or even threatening personal “visits.” The Consumer Financial Protection Bureau (CFPB) recently released a report highlighting various unfair practices and violations of the Fair Debt Collection Practices Act found as a result of recent examinations. These are some of the results in that report:

False Threats of Litigation – In one examination, a collector routinely threatened consumers with litigation even though it generally did not intend to file suit. Litigation was only actually intiated in a very small percentage of cases. 

Unlawful Imposition of Convenience Fees - CFPB examiners found that convenience fees of between $5 and $14 were charged if a consumer used a credit card, oftentimes in states where such charges are prohibited by law.

Unfair Debt Sales Practices – Several financial institutions were found to engage in unfair practices related to the sale of charged-off credit card debt. One institution overstated the annual percentage rates (APRs) in account documents. Other institutions accepted payments from consumers even after the debt was sold to a third-party debt buyer.

Faulty Training Materials – The CFPB determined that representatives regularly identified the consumer’s employer to a third-party without express permission. The collector was found to have provided faulty training materials.

These are just a few of the thousands of FDCPA violations that occur each year in California. The best way to protect yourself and other consumers is to fight back when these debt collectors break the law. For more information, visit www.SacConsumerLawyer.com/abusive-debt-collection.html. 

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Your Vote Can Save Lives

On Tuesday, Nov. 4, you can make a difference by voting YES on Prop 46.

Prop 46 will save lives. A vote of YES on Prop 46 will:

1 - Require drug and alcohol testing of doctors just like airline pilots, bus drivers, and dozens of other public safety professions. Why is that important?  The California Medical Board says experts estimate that nearly 1 in 5 doctors will abuse drugs or alcohol in their lifetime.

2 - Crack down on prescription drug abuse by requiring doctors to check the existing database before prescribing powerful narcotics. Prescription drug abuse raises healthcare costs -- over $55 billion in 2007 alone.  The state Legislative Analyst's Office says YES on Prop 46 could provide "significant" savings by requiring doctors to check the existing database.

3 - Provide access to justice for those harmed by medical negligence by adjusting the cap on pain and suffering and wrongful death for inflation.

Preventable medical errors kill up to 440,000 Americans every year – it’s the nation’s third leading cause of death behind only cancer and heart disease. The current cap on damages hasn't changed since 1975, while the cost of living has quadrupled over that time. Adjusting the cap for four decades of inflation will hold doctors accountable for needless injuries and deaths caused by medical negligence.

The insurance industry has vowed to spend over $60 million to defeat Prop 46.  We are on the side of the patients, not the insurance companies.

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Am I "judgment proof"? What does that mean?

         Sacramento debtors with little income or property have little to lose if a creditor sues them. Under the California Constitution, an individual cannot go to jail for bad debt. An individual is said to be "judgment proof" when it makes little sense for a creditor to take an individual to court because even if the creditor is successful, the creditor will have nothing to collect.

         The term "judgment proof" is not a legal term and instead is only a description for this scenario where creditors cannot collect the amount of their judgment. It is important to note that individuals who are judgment proof can still have a court judgment against them, that judgment is merely not collectable. 

          As a debtor's financial situation changes, their judgment proof status may also change. As a debtor gains income or assets, creditors may then attempt to collect the debt owed to them. Any time you are sued you should consult with an attorney to determine what assets may be at risk and discuss potential options for defending the suit. 

          If you live in Sacramento or the surrounding Northern California area, find out more about debt collection and bankruptcy at www.SacConsumerLawyer.com.

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Is a debt buyer writing you letters or suing you?

            Consumers all over northern California and the Sacramento area are familiar with the names "Asset Acceptance," "Portfolio Recovery Services," "MLA Holdings" and many more. This is because they have received letters demanding payment or lawsuits suing for a judgment on a debt. Armed with the knowledge of consumer protection laws, consumers have a fighting chance against these large companies.

           In addition to the federal and California debt collection practices acts (read more here), there are various other laws that can protect consumers from debt collectors. One such law, the Fair Debt Buying Practices Act (FDBPA), is relatively new to the scene. The FDBPA was passed by the California legislature last summer, signed into law by Governor Brown, and went into effect on January 1, 2014. 

           This law specifically targets entities that regularly purchase charged-off consumer debt for the purposes of collection, whether they collect the debt themselves, hire an attorney, or hire a third party. The law applies only to those debts purchased after January 1, 2014.

           The law applies to two specific stages in the debt collection process: the initial written communication from the debt buyer to the consumer and the initial court documents of a lawsuit to collect a debt. In both instances, the debt buyer must provide detailed information about the underlying debt. In many cases, the debt buyers don't have the information, thus, they can't satisfy the requirements of this law.

           So, when a consumer gets a letter from a debt buyer for the first time, there are several requirements, including some specific language outlined in the law, that must be included. If it is missing, or it is unclear, the consumer would likely best be served by consulting an experienced consumer attorney. Similarly, when a consumer gets served with a lawsuit, there are several things that the debt buyer must allege in the complaint. If it is missing, or it is unclear, this would likewise be a good time to seek some guidance. 

           For more information about defending against abusive debt collection, click here.

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Don't Get Taken For a Ride by a Car Dealer

             A remarkable percentage of car sales involve deception, fraud or unfair conduct. The complexity of car sales combined with the “ingenuity” of auto dealers to make as much money as they can from a multi-billion dollar industry has created this prevalence of auto fraud. 

           You can’t go far in Sacramento or other cities in Northern California before you see an auto mall. There is the Sacramento Auto Mall, the Folsom Auto Mall and the Elk Grove Auto Mall to name just a few. Invariably, just beyond those big dealerships, there are smaller used car dealerships . The stiff competition between these dealers very often leads to fraudulent and deceptive practices that can bilk consumers out of their hard-earned money.

Auto Warranties & Repairs

           California consumers come home from dealerships with defective new and used vehicles much more often than they should. Fortunately, there are both federal and California laws that exist to protect consumers. Unfortunately, many folks don’t know their rights and neglect to consult an attorney. This makes it profitable for the dealers to send people off the lot with a defective car. If more consumers begin to exercise their rights, it would send a message that a salesman can understand.

Adverse Vehicle History

           Many folks from the greater Sacramento area and Northern California are defrauded each year by misrepresentation or concealment of a car’s adverse history. These types of acts include odometer tampering, sale of flooded or wrecked cars, sale of cars with a variety of title problems, misrepresentation of the number or type of prior owners, and many more. Some of these acts are unmistakable and consumers know they need to consult a lawyer. But more often, it takes a trained legal eye to analyze the facts in order to properly protect a consumer’s interests.

Yo-Yo Sales

           A yo-yo sale is a situation in which a consumer signs a contract for a car and is allowed to drive away on the promise that the dealer will arrange financing later. Then the consumer is often told that the deal “fell through” and that deal with a higher price or interest rate is now necessary. If the consumer tries to get out of the deal, the dealer often says that the trade-in car was already sold or refuses to return the down payment.

Credit Reports

           Car salesmen are people often talented in using a prospective customer’s own information against them in negotiations. Many times the dealer will pull a consumer’s credit report without the consumer’s consent. This is illegal. This is easy to detect by looking at the consumer’s credit report. In addition to unauthorized credit pulls, car dealers have been known to report incorrect information to the credit reporting agencies. This could affect a consumer’s interest rates.

           The most important factor causing auto fraud is that cheating the customer is ingrained in the culture of the auto sales industry. At many car dealerships they believe that it is not only an acceptable way to do business, it is the only way to do business. Consumers can fight back by knowing their rights and finding help when they need it.

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Debt Collectors and Social Media

           The average California consumer spends more and more time on social media, whether it be Facebook, Twitter, Pinterest, Instagram and so on. California has, by far, the most internet users in the United States. And over 18 million Californians use Facebook (see here.) It’s common for people to check-in in real time on these apps and reveal personal details. Many people don’t think twice before putting private information on these sites. And that is exactly what debt collectors want.

           Debt collectors have used social media sites to “skip-trace” or find personal information to locate a person for any number of debt collection purposes. Google searches often bring up Facebook pages. Those pages often lead to personal information, which the debt collector can use. These practices are likely legal, but not beneficial to the consumer.

            Plus, some debt collectors may use social media to email consumers about a debt, instant message a consumer or communicate collection notices. These particular actions, however, are against the law.

           The Fair Debt Collection Practices Act has two provisions that protect consumers from these communications.

“Communication in connection with debt collection”

           This provision of the FDCPA (1692c) prohibits debt collectors from an array of communications based upon the timing, location and whether the consumer is represented by an attorney. A debt collector who communicates with a debtor via social media has very likely violated this provision. 

“False or misleading representations”

           A debt collector may not use false, deceptive or misleading representation or means to collect a debt. Sending a friend request to a consumer is usually either misleading the consumer or risking a “third-party violation” by disseminating private information to others.

           Even though debt collectors know that they are not allowed to do these things (see here), it seems to keep happening. So it remains as important as ever for consumers to know their rights and find appropriate help to protect themselves.

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The FDCPA works with landlord-tenant abuses too.

           The Fair Debt Collection Practices Act, or FDCPA, provides legal remedies for consumers harmed by creditors and collection agencies. Many people are aware of these legal protection tools. However, fair debt collection laws apply to other situations that are outside the realm of traditional debt collection. The FDCPA can also be a tool to find remedies for landlord-tenant abuses.

           The Sacramento area has a very large population of renters. That number is increasing as new apartments and condos are being built in Midtown, Downtown, McKinley Park, and other surrounding areas. While there are certainly good landlords and property managers, abusive conduct still occurs. Note that the FDCPA does not apply to landlords attempting to collect a rent debt from their own tenants. However, it does apply to attorneys, collection agencies, realty companies, and servicing companies that are employed by landlords to collect a debt.

Deceptive Eviction Notices

           Eviction notices that are served on a tenant by an attorney for the landlord are covered by the FDCPA. If such a notice misstates a delinquent tenant's obligations or threatens unlawful action, the tenant may have an FDCPA remedy for deceptive debt collection.

Excessive Security Deposit Withholding

           If a landlord's debt collector misrepresents the character, amount, or legal status of debts, it may violate the FDCPA and other state law prohibitions. 

Abusive or Harassing Language or Conduct

          Harassment in person or over the telephone is a violation of most fair debt collection statutes. A court in Pennsylvania held that a landlord's repeated late-night calls to the tenant violated the state debt collection regulation. This would likely be a violation in California as well. 

Confiscation of Tenant's Personal Property

          The FDCPA prohibits nonjudicial action to dispossess a renter of property unless the creditor has a security interest in the property. In that same Pennsylvania case, a landlord was liable for seizing and selling the tenant's televisions and other items to satisfy a debt.

          These are just a few of the practices that may violate the FDCPA or other deceptive practices statutes in California. These statutes are in place for a reason - to protect consumers who otherwise have little to no legal power to protect themselves.

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The Facts About Bankruptcy Petition Preparers

           It is often a simple truth that if you need to file bankruptcy, you don’t have a lot of money. As such, many Northern Californians in financial trouble turn to bankruptcy petition preparers, also known as “typing services.” These preparers are non-lawyers that charge a fee to generate the forms required to file bankruptcy.

           While they are typically less expensive on the front end, they can cost a debtor down the line when there is a problem. That is because there are several things that a petition preparer cannot do. They cannot:

-       advise you about exempt property;

-       tell you which type of bankruptcy to file;

-       tell you which assets to list; or

-       tell you which debts to list.

           So that’s why they are so cheap. They simple cannot do most of what an experienced bankruptcy lawyer can.

           Often times, a consumer will use a bankruptcy petition preparer to save money, but eventually have to hire a bankruptcy attorney anyway to fix the problems that arose later. The stakes are high. People can lose cars, businesses, thousands of dollars, houses.

           Even those bankruptcies that are seemingly straightforward often have intricacies that require an attorney. A bankruptcy judge recently explained in his ruling that, due the complexity of filing bankruptcy, only members of the legal profession are presumptively competent to protect a debtor’s interests. Even for a consumer-debtor with modest assets, filing for bankruptcy is a serious business.

           If you live in Sacramento or the surround Northern California area, to find more information about filing for bankruptcy, visit www.SacConsumerLawyer.com

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Student Loan Trouble? You may have options.

           Student loans can be extremely burdensome. They can cause stress and prevent graduates from having the ability to participate in the economy. This is bad for the individual consumer and it is bad for society as a whole. There are laws and government programs that can help relieve some of this stress.

           There are many factors that determine which, if any, of the following options are available to you: the type of loan, whether the loan is in default, whether collection has begun, and more. All of these factors must be considered before any affirmative steps may be taken. Read on to find out more about the possible options.

Loan Cancellation

           Loan cancellation is an ideal option to deal with student loans. However, the circumstances in which a student loan debtor may get a loan cancelled are very specific and somewhat rare. Students may possibly be cancelled due to school closure, false certification, disability of debtor, death, bankruptcy. These are but a few of the possibilities. The various types of cancellation only apply to certain types of loans and depend very much on the factual situation of each person saddled with student loans.

Postponing Payment

           There are a number of deferment programs and forbearance options to consider. Student loan borrowers are legally entitled to defer payments in certain situations, depending on the type of loan and then the loan obligation was incurred. There are unemployment deferments, military deferments, and more. Forbearance involves a student loan debtor agreeing to a temporary stoppage of payment, an extension of time to may payments, or smaller payments. Forbearance is not as appealing as deferment because interest will continue to accrue.

Repayment Options

           Whether or not a student loan borrower is in default, there exists a wide range of repayment options, including: loan consolidation, loan rehabilitation, and various payment plans. Depending on your particular goals and financial situation, a combination of these options can provide an excellent strategy to avoid or get out of default and pay only minimal payments each month.

Challenging Collection

           Finally, there are a number of defenses that can be raised in response to collection efforts by student loan creditors. However, timing for such defenses is critical. Thus, it generally behooves a debtor to seek legal help sooner rather than later. When working with an attorney, it is vital to provide all relevant documentation relating to the debt.

Good News / Bad News

           The bad news is that the high number of options to cope with student debt means that the process is confusing and overly complicated for most people. The good news is that with proper counseling there is almost always something that borrowers can do to relieve some of the debt stress.

           For more information, visit www.SacConsumerLawyer.com

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What should I look for when I look at my credit report?

           Everyone should check their credit report on a regular basis. Doing so can help stop identity theft before the effects are catastrophic. It can also make sure that if creditors and lenders are reporting inaccurate information, you can dispute it before it adversely affects your finances. The main things to look for are signs of identity theft and incorrect information.

           Look for any items that are not about you. If there are inaccuracies of any kind, flag them, such as addresses where you have never lived, accounts that are not yours, employers where you never worked, or a bankruptcy not filed by you. Look closely to see if there are derogatory marks that are not accurate. If you made a late payment, that’s ok. But if you didn’t make a late payment and your credit report says you did, that could be a problem.

           Look at the inquiries section. If there are inquiries that do not look familiar to you, they could be attempts at identify theft or mistakes. Some inquiries you don’t recognize may be legitimate attempts by businesses to pre-approve you for credit cards or insurance. Usually these don’t affect your credit score.

           If you find that there are some of these errors, there are instructions in the small print of the credit report about how to dispute those errors. If you have already done so, and the errors persist, it may be time to contact an attorney who is experienced in this area of the law.

Visit www.SacConsumerLawyer.com for more information. 

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Avoiding Automobile Lease Scams

           Automobile dealers have been known to use a wide variety of tactics that take advantage of less savvy Northern California consumers. Consumers should always read a contract before signing it. Perform your own calculations and, if the math doesn’t add up, don’t sign the contract. Make sure you understand all the terms, including early termination fees, allowable miles per year and wear and tear fees associated with the lease.

The Extended Auto Warranty - An extended warranty is not necessarily a bad deal. However, if you are leasing a car, you don’t own it. Since most leases are not longer than five years in duration, the warranty is often a waste of money. Some dealers will tell you that the extended warranty will increase the value of the car at the end of the lease. The rule of thumb to remember is: Don’t sign a lease that is longer than the manufacturer’s normal warranty.

Call-Back Scams - Sometimes your dealer will call you after you’ve signed the lease and tell you that there is an error in the contract. They will describe the increased costs as minimal or negligible or they may try to renegotiate the lease. Don’t be fooled: this is often simply a way to get more money from you.

The Vanishing Trade-In - This tactic happens when the dealer leaves your trade-in off the contract. This is one of the scams that you can avoid with a careful reading of the contract and doing your own math. If something is off in the contract, you don’t have to sign it.

The Clandestine Price Hike - This is another scam that can be avoided with careful contract reading and doing your own math. Here, you have negotiated a price with the dealer. After you negotiate and get a favorable price, the dealer leaves to write up the paperwork. When he returns, you sign, not noticing that the overall total or monthly payment has increased. Make you get all the important numbers and they are as they are supposed to be in the contract.

           These are just a few of the tactics that Sacramento auto dealers have been known to use. In any auto sale or lease, the dealer likely has the upper hand in negotiations. But you can even the playing field by educating yourself and reading contracts with a suspicious eye. If you think you may have fallen victim to auto fraud, consider seeking counsel from a local attorney knowledgeable in the area of auto fraud.

www.SacConsumerLawyer.com

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U.S. Senate Bill Aims To Protect Consumers' Credit Reports

           A bill introduced by a group of independent and Democratic U.S. Senators aims to make changes to the Fair Credit Reporting Act (FCRA) to place new requirements on the credit reporting agencies (Equifax, TransUnion and Experian) and also the companies that furnish information to those agencies.

           The bill was introduced as the Stop Errors in Credit Use and Reporting (SECURE) Act of 2014. The sponsoring Senators are Brian Schatz (D-Hawai’i), Sherrod Brown (D-Ohio), Bernie Sanders (I-Vt.), Elizabeth Warren (D-Mass.), and Richard Blumenthal (D-Conn.)

           If passed, this bill would make it easier for consumers to identify and dispute errors in their credit reports. In light of the increasing numbers of errors being reported to the Consumer Financial Protection Bureau (CFPB) (10,000 between October 2012 and 2013), the passage of this bill has the potential to combat a continually growing problem.

           In addition to check your credit report for errors and contacting an attorney for help, you can make a difference by contacting your U.S. representatives to express your support for this bill. In California, we can contact Sen. Dianne Feinstein and Sen. Barbara Boxer. If you live in the 3rd Congressional District in CA, your Representative is John Garamendi. If you live in the 4th Congressional District in CA, your Representative is Tom McClintock. If you live in the 7th Congressional District in CA, your Representative is Ami Bera. If you live in Sacramento’s 6th Congressional District, your Representative is Doris Matsui. Find your representatives here. To read more about the bill, click here. 

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Types of Student Loans

Student loans come in many shapes and sizes. The majority of student loans are federal government loans. Federal loans provide many programs to help consumers with burdensome loan debt. However, the government also has great power to collect student loans if you default.

There are also private student loans, which are made by banks and other financial institutions without financial backing from the government. Private loans are often necessary due to the high cost of education, but there are downsides. For example, interest rates are often much higher for private loans. In addition, there are fewer and less comprehensive programs to help consumers repay the debt.

It is important to find out what types of student loans you have before you start searching for a solution in earnest. You can find out from the National Student Loan Data System (NSLDS). This will help if you have government loans, but there is no similar central database for private loans. For those, you will have to contact your lenders to get more information.

You can also call the Federal Student Aid Information Center, (800) 4-FED-AID. The counselors can help you determine your type of loan. Also, look at your Federal loan promissory notes and applications. They will state the name of the federal loan program on the loan contract and your monthly bills.

Once you have determined your type of loan, move on to the next steps to find a student loan solution for you. Visit DeosLaw.com for more information. 

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Why You Can't Hide From Debt Collectors

Some lenders may consider commuting expenses if you have to drive beyond a certain number of miles to work and back every day or week. That monthly cost can factor into your overall debt-to-income ratio (DTI) and directly impact how much you can borrow.