Tag: debt collection

Law Review: Jiménez, Dalié- Dirty Debts Sold Dirt Cheap

Debt Buyer keeps naggin’ at you night and day
Enough to drive you nuts
Pick up the phone, leave me alone
It’s time you made a stand.

Paraphrase of AC/DC- Dirty Deeds Done Dirt Cheap


More than 77 million Americans have a debt in collections. Many of these debts will be sold to debt buyers for pennies, or fractions of pennies, on the dollar. This Article details the perilous path that debts travel as they move through the collection ecosystem. Using a unique dataset of 84 consumer debt purchase and sale agreement, it examines the manner in which debts are sold, oftentimes as simple data on a spreadsheet, devoid of any documentary evidence.… Read More

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4th Circuit: Powell v. Palisades Acquisition- Assignment of Judgment was an Action in Connection with the Collection of a Debt


Ms. Powell incurred a credit card debt original with Direct Merchants. After losing her job, she fell into default and Platinum Financial, the assignee of the debt, obtained a judgment against Ms. Powell. Several years later, Platinum Financial sold the debt to Palisades Acquisition, whose attorney filed an Assignment of Judgment that erroneously stated the outstanding balance owed. Ms. Powell was able to have the judgment vacated due to such errors and then commenced suit against Palisades Acquisition and its attorney, asserting claims under the FDCPA for overstating the balance due in the Assignment of Judgment. The District Court granted summary judgment for Palisades Acquisition, finding that an Assignment of Judgment did not qualify as conduct taken “in connection with the collection of any debt” under 15 U.S.C.… Read More

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Urban Institute Studies: Debt in America and Delinquent Debt in America

Debt in America Abstract:

Debt can be constructive, allowing people to build equity in homes or finance education, but it can also burden families into the future. Total debt is driven by mortgage debt; both are highly concentrated in high-cost housing markets, mostly along the coasts. Among Americans with a credit file, average total debt was $53,850 in 2013, but was substantially higher for people with a mortgage ($209,768) than people without a mortgage ($11,592). Non-mortgage debt, in contrast, is more spatially dispersed. It ranges from a high of $14,532 in the East South Central division to a low of $17,883 in New England.… Read More

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4th Circuit: Olson v. Midland Funding- FDCPA Statute of Limitations, Non-collection Notices, and Unsucessful Debt Collection Suits

Olson raised FDCPA claims in federal court against Midland, which had brought a debt collection action in state court. These claims were asserted within a year of when Olson first appeared in the state court debt collection action, but more than a year after the alleged violations. The 4th Circuit found that the one-year statute of limitation barred Olson’s FDCPA suit, as the Statute of Limitations ran from the violation date, especially as Olson had been on notice and participated in the state court action for longer than one year.

Olson further contended that privacy notices sent directly to him, after Midland was aware he was represented by counsel, violated § 1692c(a)(2).… Read More

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4th Circuit: Fontell v. Hassett- FDCPA and Homeowner’s Associations


Fontell brought suit against her Homeowner’s Association (“HOA”)alleging violation of the FDCPA, the Maryland Consumer Debt Collection Act (“MCDCA”) and the Maryland Consumer Protection Act (“MCPA”). When the district court did not grant her summary judgment on these claims, she appealled.

The Court of Appeals held that her assertion that the HOA violated the MCDCA by untimely bringing suit against her was not supported by evidence sufficient as a matter of law to grant summary judgment under Rule 56(a). The property management company, as it was always responsible for collecting the homeowner’s dues and not just after there was a default, did not constitute a “debt collector” under the FDCPA, as a default “does not occur immediately upon a debt becoming due, unless the terms of the parties’ relevant agreement dictate otherwise.” See Alibrandi v.… Read More

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N.C. Court of Appeals: Saddler v. Scott Lowery Law Office- Attorney Not Subject to FDCPA or NC Collection Agency Act


Shortly before their divorce, the Plaintiff’s then wife obtained a credit card in his name, without his knowledge. Several years later, the Plaintiff discovered the credit card on his credit report and also began to receive collection letters and calls. These ceased until there was renewed collection activity (which is not described in the opinion) starting in January 2011, in response to which the Plaintiff retained counsel to demand verification of the debt. The Plaintiff’s counsel received a packet of documents and two telephone calls from the Scott Lowery Law Office (“SLLO”), a law firm based in Colorado and Oklahoma.… Read More

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Bankr. E.D.N.C.: Carter v. B-Line, L.L.C.- Solicitation of Reaffirmations is not Debt Collection


B-Line purchased a charge account that the Debtors originally had with Kay Jewelers, which had been listed as a creditor on Schedule F of the Debtors’ petition, with a balance owing of $860.61. Following the filing of the Debtors’ bankruptcy, B-Line solicited a reaffirmation from the Debtors, including a warning/threat that “If the Jewelry purchased under this secured account have been destroyed, gifted or transferred, or sold, [B-Line] may have a non-dischargeability cause of action against you/your client(s) under 11 U.S.C. § 523.” In response, the Debtors initiated a adversary proceeding against B-Line, alleging that B-Line violated N.C.G.S. § 58-70-1 because it carried on a “collection agency business” without securing a permit through the Commissioner of Insurance before it solicited a reaffirmation agreement.… Read More

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4th Circuit: Epps v. JP Morgan Chase- No Federal Preemption of State Debt Collection Laws


Epps purchased a vehicle from Thompson Toyota subject to a retail sales installment contract (“RIC”)  that provided, among other things, that it was subject to federal and Maryland law, including the Maryland Closed End Credit Provisions (“CLEC”).  The note was later assigned to Chase.  When Epps later defaulted, Chase repossessed the vehicle and notified Epps of its intent to sell the vehicle.  Contrary to the provisions of CLEC, however, Chase did not notify Epps of the current location of the vehicle or where and when it was to be sold.  Epps later commenced a class action against Chase under CLEC for these omissions and also for breach of contract under the RIC.… Read More

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Bankr. EDNC: Robinson & Baldwin: Chapter 13 Debtor Cannot Exercise Trustee Avoidance Powers‏

In both of these cases a Chapter 13 Debtor brought an action to avoid a security interest under 11 USC § 544. The Court held that the rights and powers of a chapter 13 debtor are set out in § 1303 of the Code as follows:

1. Baldwin.PDF

2. Robinson.PDF

Subject to any limitations on a trustee under this chapter, the debtor shall have, exclusive of the trustee, the rights and powers of a trustee under sections 363(b), 363(d), 363(e), 363(f), and 363(l), of this title.
The Court held that the language of this provision clearly indicates that chapter 13 debtors were not granted the trustee’s avoidance powers found in chapter 5 of the Code.… Read More

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