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FDCPA Violation by Collection Agency

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  • 02-11-2013, 11:58 AM
    JB2013
    FDCPA Violation by Collection Agency
    My question involves collection proceedings in the State of: Virginia


    My primary residence went to foreclosure, had an 80/20. The second was charged off and sold to a debt collector since Virginia is a recourse state. I have asked for verification of the debt from the collection agency. More specifically, I requested the note and proof of the current ownership of the debt. They first sent me various signed loan documents, nothing that verified the debt nor the collection agency's claim that their client now owned the debt. When I pushed back for the correct and true documentation I was sent a bill of sale, the original note, and a signed letter from "the company" claiming to now own the debt which stated that the collection agency was working on their behalf.

    The first page of the bill of sale identified "the company" as purchasing a bulk lot of loans from my former lender. The second page was for the most part blacked out (like whomever made a copy had covered up parts of it with two sheets of paper) save for one line item which included a loan number which I have never been associated with, a property address in a completely different state, and a dollar amount that was not my original loan amount. My assumption is that someone of questionable competence made a mistake when sending me the document. Meaning that my loan number is in fact on the blacked out paper somewhere with my correct property address and loan amount.

    Obviously, I could just point out this error to the agency and make them aware that what they have sent still doesn't fulfill my request to verify the debt and its current owner. However, before I do that I want to cover all my bases. Did the collection agency violate the Fair Debt Collection Practices Act by revealing someone else's debt to me with the information on the 2nd page of the bill of sale? If so, should I report it, talk to an attorney and cease communication with the agency, or is this something I can use as leverage in negotiating a settlement on my own? Or is this not a big deal/mistake on their part and I'm just grasping at straws? Any help is appreciated.
  • 02-13-2013, 08:24 AM
    Mr. Knowitall
    Re: FDCPA Violation by Collection Agency
    Their statutory duties are pretty simple: If you make a timely demand for verification of the debt or the identity of the original creditor, if they wish to continue to collect the debt they must provide that information. You can ask for more, but your demand means nothing in relation to their statutory duties.
    Quote:

    Quoting FDCPA § 809. Validation of debts (15 USC 1692g)
    (a) Within five days after the initial communication with a consumer in connection with the collection of any debt, a debt collector shall, unless the following information is contained in the initial communication or the consumer has paid the debt, send the consumer a written notice containing --

    (1) the amount of the debt;

    (2) the name of the creditor to whom the debt is owed;

    (3) a statement that unless the consumer, within thirty days after receipt of the notice, disputes the validity of the debt, or any portion thereof, the debt will be assumed to be valid by the debt collector;

    (4) a statement that if the consumer notifies the debt collector in writing within the thirty-day period that the debt, or any portion thereof, is disputed, the debt collector will obtain verification of the debt or a copy of a judgment against the consumer and a copy of such verification or judgment will be mailed to the consumer by the debt collector; and

    (5) a statement that, upon the consumer's written request within the thirty-day period, the debt collector will provide the consumer with the name and address of the original creditor, if different from the current creditor.

    (b) If the consumer notifies the debt collector in writing within the thirty-day period described in subsection (a) that the debt, or any portion thereof, is disputed, or that the consumer requests the name and address of the original creditor, the debt collector shall cease collection of the debt, or any disputed portion thereof, until the debt collector obtains verification of the debt or any copy of a judgment, or the name and address of the original creditor, and a copy of such verification or judgment, or name and address of the original creditor, is mailed to the consumer by the debt collector.

    (c) The failure of a consumer to dispute the validity of a debt under this section may not be construed by any court as an admission of liability by the consumer.

    I'm not sure what you believe "verified the debt" to mean, but it does not include the requirement that the creditor provide detailed information about the debt. If the collector obtained a report from the creditor stating that they had verified the balance you owed as $X, and forwarded that to you, that's verification. So... what did they send as verification, and why do you believe it's statutorily inadequate?

    If they sent you a document in error, the disclosure of that document may well be a violation of somebody else's rights, but it's not a violation of yours.
  • 02-13-2013, 11:36 PM
    johnb123
    Re: FDCPA Violation by Collection Agency
    Did the debt collector not mention "(1) the amount of the debt; "? You said....."line item which included a loan number which I have never been associated with, a property address in a completely different state, and a dollar amount that was not my original loan amount."......it appears they did not actually validate YOUR debt.
  • 02-14-2013, 08:06 AM
    Mr. Knowitall
    Re: FDCPA Violation by Collection Agency
    He appears to be complaining that the second round of documents he received (with the first having potentially been sufficient) included a document that was heavily redacted, and that somebody else's account information was disclosed but that his information (if on the document) had apparently been redacted.
  • 02-19-2013, 01:14 PM
    JB2013
    Re: FDCPA Violation by Collection Agency
    johnb123 That is my position, they did not validate my debt. After two requests for validating information that were not fulfilled, I am having reservations about the level of faith this company is acting in.

    To Mr. Knowitall...I am not complaining.

    I have a collection agency TELLING me that they are collecting a debt on behalf of a specific company, who was not the original creditor. I asked for validation that A. the company the collection agency is collecting for actually owns the debt and B. that the agency has been retained to collect on behalf of their client once ownership has been established. The first round of documentation provided me surely didn't accomplish that, nor did the second. Why on Earth would I take someone's word and enter into some sort of payment negotiation without first having the information stated above validated?
  • 02-19-2013, 01:19 PM
    Mr. Knowitall
    Re: FDCPA Violation by Collection Agency
    As you have already been told, validation of the amount of the debt and proof that the debt was assigned to them are separate issues. Their statutory duties to validate the debt are set forth by statute - they don't have to jump through any additional hoops in order to fulfill their statutory duties.
  • 02-19-2013, 02:20 PM
    JB2013
    Re: FDCPA Violation by Collection Agency
    Ok, got it. Then I am having an issue with the the agency failing to provide me with proof that their client currently owns the debt. Without that, could it not be possible that this collection agency found my debt on public records, is telling me that their "client" purchased said debt from my original creditor and that they are now collecting on it? Do I have a legal right to ask for that proof, so that I can make sure of the legitimacy of the relationship of the collection agency, the new creditor they now claim owns the debt, and the sale of that debt from my original creditor? As a layman, I would certainly hope that if the "current owner" of the debt decided to pursue some legal recourse they would have to provide that exact documentation to the courts.
  • 02-19-2013, 02:31 PM
    Lehk
    Re: FDCPA Violation by Collection Agency
    You have the right to ask for it, that is guaranteed by the first amendment, but they are not obligated to do as you ask.
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