Month: January 2017

The Fair Debt Collection Practices Act is designed to protect consumer

debtors against harassment from debt collectors.

 

The Act applies to debt collectors, not to a party who is directly owed the

debt.

 

Furthermore, the act defines consumer debt as related to personal, family

and household transactions.   Therefore, the act does not apply to business

debt.   (Sometimes, it is not clear if a debt is a consumer debt or a business

debt, as in the case of the purchase of a computer).

 

There are common violations of the Act

1. Calling at inappropriate times- between 9 p.m. and 8 a.m.
2. Using abusive or profane language
3. Attempting to collect amounts which are not due – excess principal balance, excessive interest charges, excessive fees
4. Debt collectors failing to send debtors an appropriate written notice of the debt, which should legally include the official name of the creditor, the amount of debt owed and a notification that the debtor has the right to dispute the debt in question.
5. Threatening to start a lawsuit when there is no right or no intention to start a lawsuit.   

The collection agency must cease communication upon request:

communicating with consumers in any way (other than litigation) after

receiving written notice that the consumer wishes no further

communication or refuses to pay the alleged debt, with certain exceptions,

including advising that collection efforts are being terminated or that the

collector intends to file a lawsuit or pursue other remedies where

permitted.

In many situations, the collection agency or collection attorney will

stop all collection activity, since it is not economically worthwhile to

proceed with a lawsuit.

In some situations, the creditor will decide to start suit, as this is

the only viable option to collect on a debt.

 

If a consumer is represented by an attorney, and the agency is aware of

the attorney, the collection agency must deal directly with the attorney.

 

A consumer can dispute all or any part of a debt at any time, but only after

a written request sent (by the consumer to the collector)  within thirty

days of receipt of the first written  notice of the debt.   The collector must

then mail the consumer “verification of the debt or a 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.”

 

Please feel free to contact Attorney Singer, with any questions.

Attorney Robert M. Singer

2572 Whitney Avenue

Hamden, CT  06518

203-248-8278

rsingerct@yahoo.com

 

COMMUNITY PROPERTY STATE

In community property states, such as California, both parties can be responsible for each other’s debts, even if one party did not open an account with his or her spouse.

Example – a husband opens a credit card debt, and uses the money for household expenses.  The wife may be held liable for the husband’s debt.

NECESSITIES DOCTRINE

In Connecticut, and possibly all states, a spouse is responsible to provide for the necessities of the other spouse, and family   The concept is that each spouse should be assisting and be responsible for the expenses of having a household.

I have seen this doctrine used in Connecticut in situations in which there is an outstanding medical bill.  One spouse signs a form with a hospital agreeing to be responsible for the medical bills related to the care of a child.  The hospital sues both spouses because the medical care was necessary for the care of the minor child, and both spouses should be responsible to pay for the care.

MORTGAGE DEBT

There are three items related to property

1. The deed – which relates to ownership of the property
2. The Promissory Note – which indicates that a person is individually liable for a debt
3. The Mortgage – which provides that a property can be foreclosed in the event that payment is not made as required by the Promissory Note

Each party who signs a Promissory Note is personally liable for the debt associated with a mortgage.

In many cases, as part of a divorce, one spouse transfers over the marital residence to the other spouse (the transferee).   The person giving up the property (the transferor) may mistakenly believe that after the transfer, he or she is no longer responsible for the mortgage payments.   This is a big mistake.   The divorce does not affect the relationship between the borrower and the lender.

Divorce agreements often provide that the transferee (new sole owner of the property) will hold the transferor harmless with regard to the mortgage debt.   The hold harmless clause does not always work well, as the transferee may lose a job or otherwise be unable to pay the mortgage.

Please feel free to contact Attorney Singer, with any questions.

Attorney Robert M. Singer

2572 Whitney Avenue

Hamden, CT  06518

203-248-8278

rsingerct@yahoo.com

In most  cases, Chapter 13 is filed to save a home.   Chapter 13 is used to allow a homeowner to catch up on past due mortgage payments.

Chapter 13 allows for a repayment plan.  The repayment plan provides for the following

1. Payment of the past due mortgage amounts, in a period up to 60 months
2. Regular current payment of the mortgage
3. Payment to the trustee
4. Payment on other debts (this can be from 0% to 100% of the other debt, depending on the type of debt, and disposable income)

Often, the mortgage becomes late (delinquent) because a person loses income, such as from a period of unemployment.

To complete a Chapter 13 plan, a debtor needs to afford to make all regular payments on its normal monthly bills (including a mortgage payment) as well as a Chapter 13 plan payment.

A Chapter 13 bankruptcy can allow a debtor to stop a foreclosure, to allow a debtor to attempt to catch up on mortgage payments.

If you have any questions about Chapter 13 bankruptcy, please feel free to contact Attorney Singer.

Attorney Robert M. Singer

2572 Whitney Avenue

Hamden, CT  06518

203-248-8278

rsingerct@yahoo.com

 

In 2014, Connecticut law was changed to permit a “foreclosure by market sale.” 

Several things to note, the law only applies to

1.         A first mortgage

2.       The mortgage must be on a residential real property for a loan made primarily for personal, family, or household purposes (not made primarily as a commercial loan).

3.       The motion to the court must be made by the mortgagee, who is the owner or the servicer of the loan

4.       The motion is made with the consent of the mortgagor, who is the owner occupant of the property – who must be the owner of the residence located in this state

5.         First mortgage loans in which the amount due, plus liens which are prior in right to the first mortgage (such as real estate taxes) must be greater than the appraised value of the property. 

 

     Not surprisingly, I have never seen this statute used.   In many cases the law will not apply because the value of property is less than the amount of the first mortgage and real estate tax liens. 

In addition, the mortgagor and mortgagee need to agree to the foreclosure by market sale.    Many borrowers do not want to agree to a sale of their home, through the foreclosure process.    Borrowers have the right to sell their home during the foreclosure process, without the need to get approval by the court.  

If you are having problem paying your mortgage, please feel free to contact Attorney Singer at 203-248-8278, or rsingerct@yahoo.com

Attorney Robert M. Singer

Law Offices of Robert M. Singer, LLC

2572 Whitney Avenue

Hamden, CT  06518

203-248-8278

rsingerct@yahoo.com