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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

#61

Post by llsf »

Seems like there are some money left on the table.

Should someone build a small company to defend all those people solely based on some contingency fee (well a tiny percentage of what they owe or would pay if they lose).

If I owe $5,000, a lawyer takes the case, and prevent me to pay the $5,000 for a $500 fee, and I never hear again about the debt collector, that seems a win-win.

Those debt collector would start to think twice before going to court, and if really working, debt collector would start to think twice before buying debts at the first place.

It could be automated, with a single website, where I enter few details about my case (or the website contacts me based on scrawling the dockets), give me free advices to fight it myself (e.g. ask debt collector for all communication to only be done by mail, as allow by law, ask them for proof of debt, etc.). And if it escalate to court, then a lawyer would be assigned to represent me.

Looks like some software could fight this court scaling issue, by fighting before it goes to court, and then making it less predictable for debt collector to go the court route.

Re: Debt Collectors Are Transforming the Business of State Courts

#62

Post by 1-more »

Aloha wrote: post #20

The single largest thing we can do is undo the changes to bankruptcy law signed in 2005, it removed bankruptcy as a tool of the poor to discharge excess debt. It's caused there to be very little downside to lending, and lead to an explosion of debt.

I'm begging on hands and knees for everyone in this thread to read Graeber's "Debt: the first 5,000 years." The notion that debts have to be paid is very odd. If I went to a bank and asked for a loan to bet on a horse, they'd laugh me out of the building. But if they knew that no matter what they could get the money back from me, they'd cut the check. That's where we are right now with non-dischargeable debts. Who holds risk for making loans is not an iron clad law of nature; it's a matter of political will that we have changed over time.

Re: Debt Collectors Are Transforming the Business of State Courts

#63

Post by bequanna »

llsf wrote: post #61

Seems like there are some money left on the table. Should someone build a small company to defend all those people solely based on some contingency fee (well a tiny percentage of what they owe or would pay if they lose). If I owe $5,000, a lawyer takes the case, and prevent me to pay the $5,000 for a $500 fee, and I never hear again about the debt collector, that seems a win-win. Those debt collector would start to t…

How would this differ from existing debt settlement firms?

Re: Debt Collectors Are Transforming the Business of State Courts

#64

Post by bergstromm466 »

LorenPechtel wrote: post #55
netcan wrote: post #14

There have been journalists & researchers who covered these debt collectors at court. When defendants showed up, organised, they usually won. The debt collectors' lawyers didn't arrive prepared to win, because most people didn't show up. If you can win 85% of cases just by showing up, why bother. A court system that allows these dynamics to dominate isn't serving well.

Or is this because those who don't show up know they have no defense? While I agree there is a problem you're not proving it here.

Yeah ok. I think you will keep scapegoating these other ‘evil’ ‘no-defence‘ people, until you yourself are on the receiving end of systemic inequity - or systemic failure - at some point and that’s when the penny will drop...

Re: Debt Collectors Are Transforming the Business of State Courts

#65

Post by chrisseaton »

bergstromm466 wrote: post #64
LorenPechtel wrote: post #55

Earlier quoted context omitted.

Or is this because those who don't show up know they have no defense? While I agree there is a problem you're not proving it here.

Yeah ok. I think you will keep scapegoating these other ‘evil’ ‘no-defence‘ people, until you yourself are on the receiving end of systemic inequity - or systemic failure - at some point and that’s when the penny will drop...

It's pretty fundamental in our society that the court looks at the arguments presented before it. If the claimants make a reasonable case and you have nothing to say about it as the defendant then the court will act on that. The idea is that it stops people coming into the court prejudiced.

Re: Debt Collectors Are Transforming the Business of State Courts

#67

Post by bergstromm466 »

refurb wrote: post #26
brenden2 wrote: post #2

It bums me out that people who need the most help in life receive the least

What do you mean "receive the least"? Pretty much all the social programs we have target the poor, not the rich. The poor are the ones that receive the most.

Favourable (read ‘low’) tax rates for the propertied classes, as well as the neo-liberal nation-state’s tax cuts, are ribbon wrapped gifts

Re: Debt Collectors Are Transforming the Business of State Courts

#68

Post by netcan »

LorenPechtel wrote: post #55
netcan wrote: post #14

There have been journalists & researchers who covered these debt collectors at court. When defendants showed up, organised, they usually won. The debt collectors' lawyers didn't arrive prepared to win, because most people didn't show up. If you can win 85% of cases just by showing up, why bother. A court system that allows these dynamics to dominate isn't serving well.

Or is this because those who don't show up know they have no defense? While I agree there is a problem you're not proving it here.

No. This isn't a rhetorical example.

Most defendants don't know anything about the case. They've been avoiding collection calls for years as agencies sell and resell their debt. Piles of unopened mail, etc.

For their part, the agencies tend towards sloppiness. Some debt sells at Thinking about this is a matter of justice is ridiculous. It's not a justice driven process, it's an economics driven process. The agencies do this as their business. They work repetitively, create a process and pursue cases as long as average revenue exceeds average court costs. If a defendant shows up and wins, it's a small cost. Most defendants don't show up, so they don't bother spending legal time making cases good.

And yes, it is the courts responsibility to put a stop to it. For one thing, resolving debt humanely (or not) has been a court function since ancient times and still is. Secondly, debt collectors have basically turned these courts into their own shady place of business. It reflects badly on the court, besides clogging it.

Re: Debt Collectors Are Transforming the Business of State Courts

#69

Post by JamesBarney »

SpicyLemonZest wrote: post #58
JamesBarney wrote: post #27

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) And I imagine most of us agree collection should be pursuant to due process. I don't really see any other options.

I actually don't agree. Many debts in the US are effectively non-collectible, because all the property from which they could be collected is exempted. (This is especially true in Texas, where wages can't be garnished for most debts.)

I just meant a debt that is inherently non-collectible (and thus does not need to go to court) is not a debt.

For instance determining whether or not a house is a homestead and whether or not the debt is therefor effectively non-collectible or not is something that requires a court.

Re: Debt Collectors Are Transforming the Business of State Courts

#70

Post by peterangular »

rayhendricks wrote: post #37
peterangular wrote: post #33

Earlier quoted context omitted.

Yeah and to a captive market too. College textbook sales is one of the most insane rackets I've ever witnessed... "milking the students" is no exaggeration.

I absolutely agree. The whole “college experience” from overpriced textbooks to overpriced dorms is a huge racket. The covid pandemic might really shake things up though if there’s no school starting in the fall though.

I've advised a couple of people looking to go to school to take a gap-year to hedge risk of the schools having their stuff together.

If there's anything I've noticed about higher education after working in/with it, its that they're constantly behind the curve in just about everything that's not sports/research related.

I would be very scared of having a second-rate experience due to a college (and professors) not being prepared for this to the point I would sit a year out and crank out gen-eds at home in already established online programs.

Take this all with a grain of salt... Maybe I'm paranoid, but I just don't see schools being ready for this and having a solid experience ready for new students by fall unless they've already practiced remote learning/class programs.

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