Attorney Judson E Crump

Debt Settlement on the Courthouse Steps: 75% Discount – Alabama Consumer Credit Attorney Judson E Crump

May 2, 2014 by Attorney Judson E Crump 2 Comments

At 8:30 on the morning of April 23rd, I got a phone call as I was getting ready to go to work.

“Mr. Jones” was sued in Small Claims Court by a debt buyer called Midland Funding for $2,000, and he had a trial date at 2:00 p.m. The suit was allegedly for a credit card balance that had been unpaid back when the client had gotten audited by the IRS and hit with a huge tax bill. He tried to settle it with the original credit card company, but he couldn’t keep up the payments. He couldn’t afford to pay the $2000 they were asking for, so he hired me to defend the case.

It was Small Claims, which means that depending on the judge, bad evidence can possibly be allowed into the record, unlike in higher courts. The collection lawyer was there with a lot of documents and some past statements. But I pointed out a few weaknesses in the way they’d brought the case, and I offered $500, which was what my client said he could afford to pay. After reviewing the evidence and considering the possibility that they’d get nothing at all, they agreed to accept the offer.

How to Handle an FDCPA Validation Request – Alabama Consumer Credit Attorney Judson E Crump

April 29, 2014 by Attorney Judson E Crump Leave a Comment

So you’ve sent your FDCPA Validation Request…Now what?

Normally, you’ll get a letter with some basic information that says what the collector already told you: that you owed $15,000 to HSBC and they were assigned the account from HSBC and therefore you owe them money. They may have other information like “Charge Off Date,” “Last Payment Date,” “Account Opening Date,” etc. The dates are important – very important for you if they are more than 4 years old – but you should never take anything a debt collector says to be true unless it 100% agrees with your own recollection of reality. They often get flawed information from the original creditor and just parrot the bad info when they report to credit bureaus and when they seek collection from you. But if their own documentation shows the last payment or charge-off date to be more than 3 years old, then you can potentially use that document against them in court if they sue you. The statute of limitations that applies depends very much on the way they draft their lawsuit, so talk to a consumer credit lawyer before trying to beat them with a statute of limitations argument.

What if they don’t respond? Well, if you sent them the validation request within 30 days of their first contacting you about the debt, then they MUST send you the validation, otherwise they’ve violated the Fair Debt Collection Practices Act and you can hire a guy like me to sue them for you.

If it has been more than 30 days since you first heard from them, then they are not legally obligated to send you the validation. However, it is something you should make note of if you ever have to hire a lawyer to deal with them on your behalf.

Now, about those credit reports…

If your validation request also contained a notice of dispute under 15 U.S.C. 1692e(8), then the debt collector is not allowed to report the debt as owed without also noting that it is disputed by the consumer. If you check your credit report a month after you’ve sent the dispute/validation request, then the report should say something like “consumer disputes liability on this account.” This doesn’t really affect your credit score much, but it does put potential lenders and other interested parties on notice that the reported debt is possibly not actually owed.

This sort of claim isn’t going to amount to much if your goal is to sue the collector or credit bureau for damages to your credit, but if they don’t follow the law and report the account as disputed, then that does give you a potential counterclaim against them for the legal violation, and it may encourage them to take a reasonable settlement offer or just delete the account from your credit report altogether.

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How to Request Validation of a Debt via the Fair Debt Collection Practices Act – Alabama Consumer Credit Attorney Judson E Crump

April 24, 2014 by Attorney Judson E Crump 3 Comments

One of the many rights that most people don’t know they have against debt collectors is the right to request validation of the debt. Once a collector starts coming after you for money, they are required to notify you of your right to request proof that you owe them the money. Think about it this way:

Imagine that you borrowed money from your friend Luke a few years ago. You made payments as you could, but eventually fell behind and Luke got tired of asking you for the money because he didn’t want to be a jerk and had better things to do than hound you all day for payment.

So you live your life for a while, until a guy named Porkins comes up to you on the street one day and says “You owe me $500.” What? You ask. “You owe Luke $500, and Luke told me I can come get it from you, so you owe me $500. Pay up.” Do you give Porkins your money? Of course not! At least, not without proof.

Change the names from Luke and Porkins to HSBC and Portfolio Recovery Associates, and you have the same situation that tons of people face today. The law doesn’t require you to pay Portfolio Recovery Associates unless they can prove that you rightfully owe them. You have the right to request proof that the debt is owed – it’s common sense! But the law is a bit deeper than that. If you request “validation” of the debt within 30 days of first hearing from the debt collector, then THEY ARE REQUIRED to send you proof that you owed the money to HSBC and that they were rightfully assigned the debt from HSBC.

So how do you assert this right? It is easy. Just write a letter. You don’t have to quote the statute, but you should just to make it clear that they know exactly what you want. The language can be as short as this:

“I received your recent communication stating that you were collecting an alleged debt owed to HSBC. I do not believe that I owe you or HSBC for this account.

Pursuant to 15 U.S.C. §1692g, I hereby request validation of this debt. Please mail it to the address below.”
Be sure to tell them your name, address, and the account number if you have it. If you don’t know the account number, give them the last 4 digits of your social security number.

If you don’t trust yourself to do it, here is an example that I’ve written myself:

FDCPA Validation Request

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Who is Calling Me, part 3: Who is Admin Recovery LLC? – Alabama Consumer Credit Attorney Judson E Crump

April 22, 2014 by Attorney Judson E Crump 3 Comments

Admin Recovery LLC is a debt buyer based in Valhalla, New York. They are a 4 on the 10 point scale of debt collector shadiness. They may not give you their business address or send you anything in writing, even upon demand. But they do exist and they do report their accounts to the major credit reporting agencies. That was how I found them and verified their address. They do have a website: www.adminrecovery.com.

Admin Recovery’s correspondence address is

Admin Recovery

45 Earhart Dr, Ste 102

Williamsville, NY 14221

If Admin Recovery is calling you, it may be about an old Rooms-to-Go furniture bill. They may try to convince you to sign a reaffirmation agreement if you file bankruptcy, but I have never seen them provide proof of a valid security interest in any furniture. I have sued Admin Recovery LLC. If they are bothering you, give me a call.

Who is calling me, Part 2: Who is Hunter Warfield? – Alabama Consumer Credit Attorney Judson E Crump

April 17, 2014 by Attorney Judson E Crump Leave a Comment

Hunter Warfield is a collection agency based in Tampa, Florida. They are an 2 on the 10 point scale of debt collector shadiness – they have an actual website and don’t try to hide their business address.

The only time I have encountered them they were collecting on an old apartment lease. Their business location is:

Hunter Warfield

4620 Woodland Corporate Blvd

Tampa, FL 33614

I have represented clients against Hunter Warfield before, though I cannot divulge the details due to client confidentiality concerns. They are not a scam outfit and they seem to make a decent effort at verifying their account info.

Another Victory: Beat a $13,000 lawsuit by Midland Funding today. – Alabama Consumer Credit Attorney Judson E Crump

April 16, 2014 by Attorney Judson E Crump Leave a Comment

Our continuing efforts to save the families of South Alabama from credit card debt have born another ripe fruit today. In Mobile County Circuit Court Case No. CV-13-901687, I appeared in court today to defend my client from a lawsuit demanding $12,967.43 + $260 Court Costs for an alleged Sears Mastercard account. The Plaintiff, Midland Funding, was represented by Holloway & Moxley of Montgomery, Alabama and they did an unexpectedly good job of proving their case. Midland sent in a witness from St. Cloud, Minnesota to testify as to the accuracy of Midland’s records.

After a 1 1/2 hour trial, we won a judgment for the defendant.

Here’s a copy of the order:

Beat Midland Funding at Trial

The South Alabama debt relief stimulus package continues…

Sued by New Horizons Credit Union? Here’s what to expect: – Alabama Consumer Credit Attorney Judson E Crump

April 16, 2014 by Attorney Judson E Crump Leave a Comment

New Horizons Credit Union is an small credit union that does business primarily in Mobile County and Baldwin County, Alabama. I do not bank there, so I cannot say anything about their customer service before you default on a loan, but I have represented clients who have been sued by New Horizons. As a general rule, New Horizons does not send its defaulted accounts to collection agencies. So if you get behind and the balance is more than a few hundred bucks, you can expect them to sue you. In Mobile County, they are usually represented by Barre Dumas of Dumas & McPhail, a collection law firm based in downtown Mobile. I’ve dealt with Barre on numerous occasions and I can tell you that he’s a nice and honest man. But he is still going to do his job, and unfortunately for you, so is New Horizons. Unlike a lot of the larger out-of-state banks and credit card companies, New Horizons does a decent job of recordkeeping. They try to include copies of the loan agreement and pay history with the complaint and they have a “VP of Collections” who signs an affidavit stating that the records are accurate. To make matters worse, that same VP of Collections will likely show up for a trial date if you deny the allegations.

So basically, New Horizons Credit Union is tough to beat in court unless they’ve just made a mistake or you have a substantive defense like failure to follow UCC rules on repossession, etc. They sue for their own debts, not those made by other companies, they provide the court with copies of their documents, and they may actually send a witness.

If you’ve been sued by New Horizons, it may worth your time to call them and try to work out a settlement you can afford. If they won’t work with you, then you may be forced to either take a 25%-of-your-paycheck garnishment or file bankruptcy.

Foreclosure Timeline in Alabama Under the New Dodd-Frank Rules – Alabama Consumer Credit Attorney Judson E Crump

April 11, 2014 by Attorney Judson E Crump Leave a Comment

The Dodd-Frank Wall Street Reform Act of 2009 did a lot to help ordinary people deal fairly with their lenders and mortgage servicers. In the bad old days, the only rules that mortgage companies had to comply with were the terms of the contracts they wrote to protect themselves from greedy working people who were always looking to take advantage of their generosity to, ummm, keep a roof over their childrens’ heads. Today, things are different. One of the strongest protections that people have against mortgage fraud and abuse are the prohibitions on foreclosure during early default and during loss mitigation negotiations.

The 120 Day Rule. 12 CFR 1024.41(f)

The first and most clear rule is the 120 day rule. It’s real simple: You can’t foreclose on somebody until they’re at least 120 days in default. Now, the regulations don’t define “default,” so you’ll have to look to your bank-written contract for that term. But usually you can take it to mean what you probably think it means already: the day the grace period expired on your last full payment. If, for instance, you missed the January 2014 payment, the February 2014 payment, and the March 2014 payment, but made a full payment in April, then that April payment must be credited towards your January payment, and therefore as soon as it is received, you are approximately 90 days in default. That’s what your Credit Report should say and that’s your real status…which means that they can’t foreclose on you until you get a full 4 payments behind!

The 45 and 37 Day Rules. 12 CFR 1024.41(c)

If you have sent in a complete loan modification application, your lender or mortgage company cannot start foreclosure proceedings until they give you an answer. UNLESS, they’ve already begun the foreclosure process and you don’t mail the modification packet to them until 37 days before the foreclosure. To illustrate: The bank has set a foreclosure sale for February 10th. You send in a modification packet on January 1 by regular mail. The bank gets it January 5th, which is 36 days before the foreclosure sale. They can still foreclose. If, however, you sent the package overnight, so the bank got it on January 2nd, which is 39 days before the foreclosure sale, then the bank cannot foreclose until they have reviewed your loss mitigation application. This rule applies not only to loan mod applications, but also other loss mitigation options, like short sales and deeds in lieu of foreclosure.

If you get the packet in before the 37 day deadline, the bank MUST properly evaluate you according to its own servicing rules, the rules of its investors, and any government programs that are applicable, like HAMP, 2MP, MHA-UP, or the FHA or VA policies. All you are entitled to is a review. You are NOT guaranteed a loan mod – just a fair chance. The bank must postpone the foreclosure as needed to review your application. They are supposed to give you an answer within 30 days. If they do give you an answer, they can require a response from you within 7 days. So if they call you a week before foreclosure and say, “We’ve decided to give you a trial modification, you have 7 days to accept,” then that is OK. If you don’t give them an answer in time, they can proceed with foreclosure on the assumption that you’ve rejected their offer. The lesson: get ready to spend some money at FedEx overnighting things to make sure that you communicate quickly and in writing.

There is also a 45 day rule that says that if you send in a “loss mitigation application” more than 45 days before a scheduled foreclosure, they have to tell you within 5 days that a) they got the package and b) it’s either complete or incomplete. If it ain’t complete, then they have to tell you what you need to provide to complete the application.

One thing the rules don’t really address is the fact that Alabama law does not require more than 37 days’ notice to you before a foreclosure, so there may be situations where the 37 day and 45 day rules don’t apply because theoretically, the mortgage company could receive your loan modification packet and then immediately call Sirote & Permutt to schedule a foreclosure in 28 days. That situation hasn’t come up before the courts yet, because the law has only been in place since January 10th. If it happens to you, give me a call. I enjoy taking interesting cases.

How to Answer a Debt Collector Phone Call – Alabama Consumer Credit Attorney Judson E Crump

April 9, 2014 by Attorney Judson E Crump Leave a Comment

My phone keeps ringing and ringing with calls from numbers I don’t recognize. I know they’re bill collectors trying to get me to pay some old credit card I used to have. I don’t really feel like dealing with this crap, but is can I get in trouble for not picking up?

NO. There is no penalty for choosing not to answer a phone call from a debt collector. The only communications from your creditors that you can get in trouble for not answering are lawsuits. And lawsuits cannot be served by telephone; they must be served in person or by mail. If you do get served with a lawsuit, you MUST answer it quickly. Read about how here.

But as a general rule, if it is important, it will be in writing. Period. So answering debt collector phone calls is entirely optional.

Personally, I recommend answering the phone call for two reasons: First, it might be a quick way to work out a debt settlement. Some debt collectors genuinely do want to try to work out a deal you can afford. Others are just assholes. The only way to know the difference is to pick up the phone.

Second, talking to a collector is the only way to get useful information, like who they are, where they are located, and what their corporate identity is – in other words, all the information you need in order to sue them for violating the FDCPA. Most FDCPA violations occur during telephone calls. They don’t usually write letters containing obvious legal violations like profanity or bogus threats to come take your furniture. Collection agency callers feel more free to be jerks over the telephone, and that’s when they’re most likely to