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Debt Collectors Are Transforming the Business of State Courts

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Re: Debt Collectors Are Transforming the Business of State Courts

#101

Post by bsder »

verylittlemeat wrote: post #90
netcan wrote: post #88

Earlier quoted context omitted.

Exactly the point. To win, they need to cross all the Ts you mention. OTOH, they can also win if the defendant no-shows. At the bottom end of the debt collection pool, one strategy is to buy debt with a high chance of no-show and win cases that way... no need for meticulous and expensive lawyering. If people aren't answering their phones or opening any official looking mail... It's not the only strategy, but it is on…

In order to have a default judgment against a person they must be served (aware of the situation). If you're being told "show up to court or face a negative outcome" and you do nothing then whose fault is that? You took on the debt. You decided not to show up in court. Are debtors just never accountable for their actions? Also to quote a comment by a lawyer in this thread >I am licensed in California and Texas, and i…

> You took on the debt. You decided not to show up in court. Are debtors just never accountable for their actions?

And what happens when that debt is $117 from Comcast because you "didn't return their cable modem" and they lost a class-action lawsuit about this?

Did I document that I returned their cable modem 4 years earlier because I used my own? Probably. Did I bother keeping that record for 4 years after it didn't appear on any of my bills? No.

So, when I moved and I didn't have a cable modem to return and they charged me for it and then turned it over to debt collectors (and magically never notified me before it went to debt), I wound up with a stupid-ass $117 judgement that I'm going to have to hire a lawyer for, force Comcast to disgorge 4 years of records, and put it on a docket.

And then Comcast will finally not show up and I'll win. After spending WAY more that $117 of resource and time.

Or I can ignore it for 3 years and file to drop it with the credit agencies and then they'll get rid of it.

Re: Debt Collectors Are Transforming the Business of State Courts

#102

Post by verylittlemeat »

ensignavenger wrote: post #98
verylittlemeat wrote: post #78

Earlier quoted context omitted.

>They've been avoiding collection calls for years as agencies sell and resell their debt. Piles of unopened mail, etc. OK but with the exception of fraud and incorrect identity then the rest of the people have a real original debt right? The debt might be sold at a fraction of it's original amount but that's because the debt collector takes a risk to put in time and legwork in exchange for collecting a real legal deb…

Fraud in debt collection is rampant. Yes, there are legitimate debtors, but you can't assume than some one who is being sued legitimately owes the debt. Even without fraud, many debt collectors illegally harass the debtors, knowing they can't afford a lawyer to defend themselves.

AFAIK harassment in most states is very illegal now and is a great way to get your debt dismissed.

The same goes for fraud in debt collection. As I mentioned in previous comments, tactics like sewer service by debt collectors are a great way to get your debt dismissed.

Many people with lapsed unsecured debt know they owe that money, they simply prefer to pretend the debt will go away if they ignore it. If they don't know they owe the money then they definitely know they're being sued because in court they can't get a judgment against you without you knowing about it. On top of that many states require the debt collector to prove you owe the money even if you completely neglect engage with the system at all.

Re: Debt Collectors Are Transforming the Business of State Courts

#103

Post by intopieces »

verylittlemeat wrote: post #100
derekp7 wrote: post #95

Earlier quoted context omitted.

What if you don't owe the debt, however you are hit with dozens of summons to show up to different courts for different supposed debts? How is it fair to force a totally innocent person to take time off of work, possibly hire a lawyer, in order to not have a default judgement against them from a shady debt collector?

Sure that aspect of debt collection can be improved and is a clear injustice. How many debt collections are of that nature vs people with real lapsed unsecured debt though? If i had to guess not nearly as many. I'm mostly taking issue with people who are threatened with a default judgment for a real debt but pretend it isn't happening and then turn around and cry abuse by the system.

I contend that the debt, after being sold, is not “real” any longer, and therefore the debtor has no moral obligation to repay it. Legal? Definitely.

The original lender has written the debt off, probably gotten a tax break from the government, and moved on.

People and companies break contracts all the time. Moralizing over it is just a distraction from the economic and juridical forces at play.

Re: Debt Collectors Are Transforming the Business of State Courts

#104

Post by clairity »

verylittlemeat wrote: post #84
netcan wrote: post #71

Earlier quoted context omitted.

This isn't a case where a guy didn't pay his builder and then no-shows at court. These are debts sold at >10% of face, often smallish debts that have accrued massive interest. Some agencies specialise in persistent calling. Some specialise in deal-making. Some specialise in legal proceedings. These are the ones we are talking about. To work, they need to keep legal costs low. They often don't bother to have a case, b…

Most states now have laws against debt collection harassment and have caps on debt collection interest and fees. There has to be proof in court that a debtor was served papers to get a judgment. There's a term called 'sewer service' where some shady collectors try to fake this service. If you get lucky your debt collector might try this on you, it's a great way to get debt wiped clean by a very angry judge.

unless the debtor has the cash ready to pay, most debtors never, ever respond (and shouldn't) to any actions to collect debt by a third-party collector, so that there is no chance at the even tiniest appearance of acknowledgement.

often, even if you have the intent to pay the debt, paying to any agency other than the originator of the debt is risky. debt collectors roll over debt en masse to keep them legally fresh and will not honor any promises that haven't been duly signed and served.

Re: Debt Collectors Are Transforming the Business of State Courts

#105

Post by a1369209993 »

verylittlemeat wrote: post #85
TheOtherHobbes wrote: post #83

Earlier quoted context omitted.

No it isn't. Many people become debtors because they have no choice. If the choice is between clocking up an insane credit card bill at astronomical rates or not having your family thrown out onto the street for another month or two because maybe your job search will finally pay off, what would most people pick? Some people get into debt because they can't manage money. A lot of people get into debt either because th…

You're moving the goal posts on me. I'm talking about debt collection enforcement not the morality or circumstances of why people take on debt.

You're the one who put the goalposts on:

> the rest of the people have a [legitimate] original debt right?

> the narrative of the debtor as victim is a bit oversold.

When in fact the narrative of the debtor as victim is significantly undersold, and many (I suspect, but won't assert, most) original debts were incurred due to usurious and predatory lending.

I wouldn't argue that debt collection enforcement is outright unethical in general, but their cases tend to very flimsy, and if people realize they can easily knock them down... good for them.

Re: Debt Collectors Are Transforming the Business of State Courts

#106

Post by verylittlemeat »

intopieces wrote: post #103
verylittlemeat wrote: post #100

Earlier quoted context omitted.

Sure that aspect of debt collection can be improved and is a clear injustice. How many debt collections are of that nature vs people with real lapsed unsecured debt though? If i had to guess not nearly as many. I'm mostly taking issue with people who are threatened with a default judgment for a real debt but pretend it isn't happening and then turn around and cry abuse by the system.

I contend that the debt, after being sold, is not “real” any longer, and therefore the debtor has no moral obligation to repay it. Legal? Definitely. The original lender has written the debt off, probably gotten a tax break from the government, and moved on. People and companies break contracts all the time. Moralizing over it is just a distraction from the economic and juridical forces at play.

You can break your contract too by declaring bankruptcy and screwing over the debtors.

Your debt might not be real or moral but you still legally have to pay it so what does that change.

Re: Debt Collectors Are Transforming the Business of State Courts

#107

Post by verylittlemeat »

clairity wrote: post #104
verylittlemeat wrote: post #84

Earlier quoted context omitted.

Most states now have laws against debt collection harassment and have caps on debt collection interest and fees. There has to be proof in court that a debtor was served papers to get a judgment. There's a term called 'sewer service' where some shady collectors try to fake this service. If you get lucky your debt collector might try this on you, it's a great way to get debt wiped clean by a very angry judge.

unless the debtor has the cash ready to pay, most debtors never, ever respond (and shouldn't) to any actions to collect debt by a third-party collector, so that there is no chance at the even tiniest appearance of acknowledgement. often, even if you have the intent to pay the debt, paying to any agency other than the originator of the debt is risky. debt collectors roll over debt en masse to keep them legally fresh a…

Contact from a third party collector? Sure, don't respond. But if you're being summoned by the court under threat of a default judgment then you should probably show up or don't be surprised about the outcome.

Re: Debt Collectors Are Transforming the Business of State Courts

#108

Post by eli_gottlieb »

JamesBarney wrote: post #54
eli_gottlieb wrote: post #43

Earlier quoted context omitted.

> I think we all agree you should be able to collect on a debt. (if you can't it's not a debt) Nah, not really. Depends on the debt, honestly.

In what since is a debt that I am unable to try pursue or collect on a debt? Maybe a concrete example would help.

I just don't agree that you ought to be able to legally go after anyone for more than the principal on things like "consumer" debt.

Re: Debt Collectors Are Transforming the Business of State Courts

#109

Post by a1369209993 »

intopieces wrote: post #103
verylittlemeat wrote: post #100

Earlier quoted context omitted.

Sure that aspect of debt collection can be improved and is a clear injustice. How many debt collections are of that nature vs people with real lapsed unsecured debt though? If i had to guess not nearly as many. I'm mostly taking issue with people who are threatened with a default judgment for a real debt but pretend it isn't happening and then turn around and cry abuse by the system.

I contend that the debt, after being sold, is not “real” any longer, and therefore the debtor has no moral obligation to repay it. Legal? Definitely. The original lender has written the debt off, probably gotten a tax break from the government, and moved on. People and companies break contracts all the time. Moralizing over it is just a distraction from the economic and juridical forces at play.

To be fair, it's completely legitimate to issue debt that the original lender can sell for liquidity, although it should probably be difficult or impossible for institutional lenders (eg credit card or mortgage) to originate those. The real problem is the combination of interest and inablity to default onto some concrete piece of collateral, which in the creditor-preferred case of making incremental payments without net reduction in the principle, amounts to fractional ownership (like owning stock in a corporation) of a person, ie slavery.

Re: Debt Collectors Are Transforming the Business of State Courts

#110

Post by sokoloff »

intopieces wrote: post #103
verylittlemeat wrote: post #100

Earlier quoted context omitted.

Sure that aspect of debt collection can be improved and is a clear injustice. How many debt collections are of that nature vs people with real lapsed unsecured debt though? If i had to guess not nearly as many. I'm mostly taking issue with people who are threatened with a default judgment for a real debt but pretend it isn't happening and then turn around and cry abuse by the system.

I contend that the debt, after being sold, is not “real” any longer, and therefore the debtor has no moral obligation to repay it. Legal? Definitely. The original lender has written the debt off, probably gotten a tax break from the government, and moved on. People and companies break contracts all the time. Moralizing over it is just a distraction from the economic and juridical forces at play.

Why would selling debt make you morally not responsible for it? My mortgage has been sold multiple times. IMO, I still 100% have a moral (and obviously legal) obligation to pay it.
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