Bankruptcy may put a stop to harassing creditors

Credit collectors may use harassing tactics to threaten debtors, but there are ways to put a stop to them.

People who owe a significant amount of debt to creditors in Kentucky and across the nation may be familiar with receiving harassing calls from creditors. Once people miss payments on their credit cards, mortgages, medical bills or other expenses, creditors may begin to call, send emails and even press charges against debtors. In some cases, the calls may become so harassing, that people are afraid to answer their phones.

Collector abuse

In one case, a Texas-based debt collection agency was shut down by the Federal Trade Commission for using verbally abusive scare tactics to collect money on overdue payday loans. Collectors were found threatening to take people to jail if they did not respond. Some collectors told people that they would lose their children if they did not start repaying their debt. Other incidents involved harassing creditors telling people that they would hurt their pets or even dig up dead relatives. Creditors were found to call people in excess of seven times a day, including late at night, early in the morning and at their place of work.

Debtors rights

The Fair Debt Collection Practices Act prohibits collectors from making constant calls, using profane language, adding more to the initial debt amount or threating debtors to garnish wages. It also protects people from having collectors take them to court as a way to regain unpaid debt. Debt collectors do not have the authority to pose as federal authorities or other officials to intimidate debtors.

Automatic stay

When people file for bankruptcy, an automatic stay is put in place by the U.S Courts. An automatic stay halts creditors from contacting debtors in order to regain property and assets. Depending on the circumstances surrounding the situation, the automatic stay may be in place for a temporary period. As long as the stay is in place, however, creditors can no longer pursue or continue wage garnishments or lawsuits. They can not make telephone calls, send emails or correspond with the debtor in any other fashion.

It is crucial that people submit a comprehensive list of all their debtors when filing for bankruptcy, as these are the crediting agencies that will receive the notice of automatic stay.

Obtaining legal counsel

People who are faced with harassing creditors, overwhelming debts and the pressure of trying to make ends meet, may find solace in speaking to an attorney. A bankruptcy lawyer in Kentucky may be able to answer your questions and point you in the right direction when it comes to choosing the right legal option.