It is for this reason that FTC has formulated new rules that prohibit these agencies from such practices.
- According to the TSR, all debt collection and settlement agencies now require making specific and clearly defined disclosures to a debtor no matter how many installments are failed. This prevents them from making any misrepresentations or false commitments to allure or entrap the debtors into their nets.
- According to the collection rules, any violations of the TSR will entitle the legal authority and even the debtor to take action and provide them with a private and reasonable cause of action against such violations of the TSR.
However, the consumer law attorney must review the situation and the case according to the state consumer law statutes. This will give your case a great weight typically to the violation of a federal statute or the FTC rule. The attorney must find out a reasonable deceptive act performed by the debt settlement company under the state consumer statute.
The complex features to understand
Just as any legal literature, the FTC rule is also difficult to understand due to the complexities in it which is why teaming up with a consumer law attorney is the most effective way to deal with any such situation.
- The FTC rule basically indicates that in an instance where there is a violation of an FTC rule the debtor has the right to take use the private cause of action clause and also allows the consumer to claim for statutory as well as actual damages.
- However, the extents that a debt settlement company may take to outwit the TSR and the interaction between the State and Federal law make the process of a potential claim made against a debt settlement company more complex. This is another reason you should contact an experienced end reliable consumer law attorney and get the right legal advice and counsel.
- The primary purpose of the Fair Credit Reporting Act, FCRAis to promote privacy, accuracy, honesty, and fairness during debt collection or settlement negotiation. The law states that there should not be any inaccurate information passed, no use of abusive language or threats given during the collection or settlement process. The law also ensures proper and precise reporting to the credit bureaus regarding the credit and financial histories of the consumer.
Ideally, this is a consumer protection law and therefore above all it provides you with a number of rights with regards to credit bureaus and collection agencies. The rules and regulations are also applicable to all specialty agencies that deal with medical records, loan documents, rental histories, and check writing histories.
Crucial factors for debtors
All these rights and protections are crucial for all debtors. This will protect your credit history and FICO score both of which are the most significant tools that will either enable you or prevent you from getting a loan in future, finding and affordable rental housing, purchasing a car, being approved for a mortgage or obtaining an educational loan and lots more.
It is therefore recommended that you first find out a reputable and reliable debt settlement company so that you have your purpose solved and your account does not move to the debt collection agencies making the situation even worse. If you cannot find one to deal with your debts you can click here to know more about debt settlement companies, there success rate, reputations, ratings and read the company reviews and then make an informed and educated choice.
Even after that if you find that you are scammed or ill-treated by the settlement company, the consumer reporting agency, the credit bureau, or any other relevant businesses that may translate into FCRA violations, you should contact a consumer attorney as soon as possible.
Know your rights
The attorney will help you to know your rights and protect you and if there is any FCRA violation guide you through the complex legal process to claim for statutory damages. There are lots of affirmative rights provided under the FCRA to you. Some of these protections are:
- Know your credit history: The law allows you to know what is included in your credit history. It allows you to request and obtain a copy of your credit history and disclosure from each of the consumer reporting agencies once in a year for free under certain circumstances such as when you are a victim of identity theft or you are on public assistance. In other situations, you may have to pay a fee to obtain the full credit history file from the agency.
- Know your score: You also have the right to request your credit score from the consumer reporting agencies. Though some may provide it for free in specific situations you will usually need to pay a fee to know your credit score.
- Know if it is against: Sometimes your credit history may be used against you by a company for example to deny your application for a job, a loan, a credit card, or insurance. In such a situation, the company must tell that they have used your credit history to reject your application and also tell the name and detail contact information of the agency that provided such information.
- Dispute incorrect info: Sometimes there may be a few incorrect entries and incomplete information in your credit history. In such a situation the law allows you to dispute this with the consumer reporting agencies. When you do so, the credit reporting agency must investigate the matter and the situation. If there is any inaccurate, incomplete, incorrect or unverifiable information is found in your file then the agency usually has only 30 days to remove it.
In case of denial of your rights, you can take legal action and claim compensation but make it soon so that the agency cannot cause severe damage to your credit and future.