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    Edelman, Combs, Latturner, & Goodwin, LLC

    20 South Clark Street
    Suite 1500
    Chicago, IL 60603

    info@edcombs.com
    Phone: 312-739-4200
    Fax: 312-419-0379


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    Archive

    Banking Credit Reports

    Wednesday, July 31st, 2013

    Great article today in the New York Times about ChexSystems and other banking credit reporting bureaus.  Many consumers are being blacklisted by banks due to mistakes or errors in the banking credit reports.  We have assisted many consumers with this type of problem.  You have a right to obtain a copy of these reports by contacting ChexSystems, or whichever other bureau the bank used to get its report.  If information in your ChexSystem or other banking credit report is inaccurate,  you have a right to dispute it pursuant to the Fair Credit Reporting Act.   If the report is not corrected, contact a consumer law attorney such as Edelman, Combs, Latturner & Goodwin, LLC for assistance.  It is possible to sue under the FCRA to seek statutory damages of up to $1,000, actual damages, including emotional distress, and punitive damages.

    http://dealbook.nytimes.com/2013/07/30/over-a-million-are-denied-bank-accounts-for-past-errors/?nl=todaysheadlines&emc=edit_th_20130731&_r=1&

    Nursing home debts.

    Tuesday, July 30th, 2013

    Question: A nursing home has sent me a statement for my uncle’s expenses with a note that they need to be paid. The statement is for the last 8 months. Why would they have waited this long to ask for money? I haven’t signed any papers nor am I on any of his financial accounts. Are they out of luck with collecting this debt? I’ve got my own financial troubles to deal with so I’m not willing to be responsible for anyone else.

     

    Answer:   Under federal law, a nursing home participating in the Medicare/ Medicaid programs cannot require a guarantee from a relative for ANY patient, whether a Medicare/ Medicaid patient or not.  Under state law, you have no liability for the debts of another absent a signing writing to that effect.  So you have no liability whatever.  Furthermore, the attempt to bill you may be unlawful.  I would not ignore the bill but write back asking for a copy of anything you signed undertaking to pay this debt.  Also, check your credit reports to make sure the debt does not appear on it.  If they do not go away, or the debt is on your credit report, you may have a claim, and should contact us.

    Attempts to collect settled debt.

    Tuesday, July 30th, 2013

    Question:  I had a debt in excess of $8,000 back in 2009. I received a letter from a collection agency saying they will settle it for $6,000. I happily agreed to save that $2,000 and paid the $6,000. I had received a letter showing that it was settled in full. Three years later, I get a letter in the mail threatening suit by another third party collection agency for that same $2,000 from earlier. Turns out that collection agency sold it to another one. Now I can’t find that letter since I figured everything was OK. When I call that original collection company, they said they have no record of me settling. They said it was just a payment for $6000 and that I never paid the rest.   Is there anything I can do? Don’t they monitor and record all calls?

    Answer:  Your testimony plus proof of payment is sufficient basis for a defense of accord and satisfaction.   Send a letter to the agency trying to collect the $2,000 stating that you settled the debt, refuse to pay, and will take legal action if any attempt is made to collect it again. Enclose proof of the $6,000 payment, taking  care not to disclose financial information such as account numbers.

     

    Check your credit reports to see if the debt is listed as unpaid.   If it is, dispute the debt with each credit bureau in writing, again stating that the debt was settled and enclosing proof of payment.

     

    If the agency continues attempting to collect, or lists the debt as unpaid on your credit reports, sue the second agency for violation of the Fair Debt Collection Practices Act and Fair Credit Reporting Act and the first agency for breach of contract and fraud.

     

    People should keep a file relating to settled debts on a permanent basis.  Complaints such as this are extremely common.

    Sued in another state

    Thursday, July 25th, 2013

     

     

    Question: If received a letter in the mail stating I am to appear in small claims court out of state, what can I do?   I’ve been issued a citation from small claims court in the state of Indiana. Apparently, I was to appear earlier this year, but was not informed at the time.  I  now have to show just cause and am in jeopardy of being issued a warrant for my arrest.
    Answer:    A court in another state cannot exercise jurisdiction over you without some connection between you and the state.  If you did not reside in Indiana at any time, and did not transact business there, the court may not have jurisdiction over you.  If you did business by phone or mail, a business selling you a product or service generally cannot sue you where it is located, but must go to your state.  On the other hand, if, for example, you received medical services in Indiana in person  or bought something from a merchant there in person, and did not pay, they may be able to exercise jurisdiction over you.

    You need to consult an attorney to evaluate the jurisdiction issue.  Generally, you get to contest jurisdiction once  —  either you can appear in Indiana and contest it, or wait until they try to enforce the judgment in your state and contest it then.  Generally the latter is more favorable to you.  However, you need to make sure that they cannot enforce the judgment against you in Indiana, which they may be able to try if you bank at a bank that has offices in Indiana.

    If you do not want to contest jurisdiction in Indiana, you should not communicate in any way with the court without consulting an attorney.

    Apart from the question of jurisdiction, it is a violation  of the Fair Debt Collection Practices Act for a debt buyer, collection attorney, or other debt collector to file a lawsuit on a consumer debt except in the judicial district where a written contract on which the lawsuit is based was signed, or in which you reside when the lawsuit was filed.

    If this is a consumer debt, you need to contact an attorney immediately.  You should be able to obtain representation for the Fair Debt Collection Practices Act suit without payment, based on the availability of fees under the statute against the other side.

    If this debt involves a truck driver training course, consult us immediately, as there is a pending class action challenging the practice of certain companies filing lawsuits in Indianapolis against students who have no connection with Indianapolis.

    Medical bills of spouse

    Thursday, July 25th, 2013

    Question: Am I responsible for my wife’s medical bills after she passed?   My wife recently passed and I have a court date to set up payments for hospital bills for my wife dating back to 2006.
    Answer;

    Generally, yes.  There is a Family Expense Act in Illinois which makes one spouse liable for family expenses of the other.  Non-elective medical care would generally qualify.

    There is an exception.  Under federal law, one spouse has the right to contract based on his/her credit alone, and if that is done federal law displaces state law.   An attorney would have to review any contracts to advise you with respect to the hospital and doctor bills.

    On the other hand, medical bills are very difficult to collect.  They are  often filled with errors and overcharges.  Send a letter disputing the debt, requesting a detailed itemization of the bills, and requesting  a copy of the medical records, with a copy to each provider.  Go through the bills and compare them to the records and see if there are any discrepancies.  Chances are there will be some, along with charges for items or services not furnished and outlandish items (e.g., $100 for an aspirin).  The provider or collector has to prove that the bills are accurate, the services are medically necessary, and the reasonable value of the services.  The collector may become more reasonable when it sees you will not just accept the charges at face value.

    Also, check and see if you qualify for charity care/ writeoffs.  Illinois hospitals are required to provide same in exchange for their tax exemptions.

    Finally,  the statute of limitations may be 5 years, depending on what if anything  you signed.  (If you signed nothing and your only liability is under the Family Expense Act, it is five years.)  The five years runs from breach and is restarted by payments.  A continual course of treatment on account may prevent it from running.  Again, the advice of an attorney is needed.

    Complaints Received by Consumer Financial Protection Bureau

    Thursday, July 25th, 2013

    Ian Ayres of Yale, together with  Jeff Lingwall and Sonia Steinway, have written Skeletons in the Database:  An Early Analysis of the CFPB’s Consumer Complaints.  This is the abstract:

    Analyzing a new data set of 110,000 consumer complaints lodged with the Consumer Financial Protection Bureau, we find that (i) Bank of America, Citibank, and PNC Bank were significantly less timely in responding to consumer complaints than the average financial institution; (ii) consumers of some of the largest financial services providers, including Wells Fargo, Amex, and Bank of America, were significantly more likely than average to dispute the company‘s response to their initial complaints; and (iii) among companies that provide mortgages, OneWest Bank, HSBC, Nationstar Mortgage, and Bank of America all received more mortgage complaints relative to mortgages sold than other banks. In addition, regression analysis suggests that consumer financial companies respond differently to complaints about different products and based on different issues, generating significant differences in timeliness of response, as well as significant differences in whether consumers dispute that response. Moreover, demographics matter: there were significant increases in mortgage complaints per mortgage in ZIP codes with larger proportions of certain populations, including Blacks and Hispanics, as well as an increase in untimeliness and company responses disputed for groups on which the CFPB is mandated to focus, including senior citizens and college students.

    Threats from debt collector

    Thursday, July 25th, 2013

    Question:  My husband took out a payday loan. Someone  called him at work and threatened him with a warrant if he didn’t pay $500 within the hour.  Is this  legal?

    Answer:  Absolutely not.

    You cannot be arrested for nonpayment of a loan.

    If the loan was obtained over the Internet from an unlicensed lender, it is not enforceable at all, and you may be entitled to substantial statutory damages from the lender (assuming it can be found and served).  Check with the Illinois Department of Financial and Professional Regulation as to its license status.

    No legitimate debt collector will call you and make a demand like that.  It is quite likely that you are dealing with a scammer.   Ask for a written notice concerning the debt and the collector’s address.  (They are required to provide that within five days of their contacting you.)  The statements made are a flagrant violation of the Fair Debt Collection Practices Act, although again it may be hard finding and collecting from the culprit.   Call us and we may be able to identify the collector.  In any event you should report calls like this to the Federal Trade Commission, Consumer Financial Protection Bureau, and state Attorney General.

     

    Under no circumstances should you provide any banking or other personal information to such a caller.

    Cosigners

    Tuesday, July 23rd, 2013

    Question:   I did a voluntary repossession.  The  auto loan company said I had to pay the storage fee,  repossession fee and a deficiency remaining after the car was sold.  They claimed that if I did not pay that  full amount they would garnish my checks an the co-signers checks also. Is that possible?

    Answer:  An auto finance or loan company that repossesses collateral can sell it and recover a deficiency if it shows that the sale is commercially reasonable.  There cannot be a garnishment or wage deduction  unless they sue you, serve you with process, and obtain a judgment.

    A cosigner in Illinois is entitled to written notice of default and an opportunity to take over the contract payments before any collection action is taken, including credit reporting and repossession.  815 ILCS 505/2S.   The cosigner should determine whether there has been a violation, and whether the alleged debt appears on their credit reports.

    Have the contract and all of the notices you received in connection with the repossession and sale reviewed by an attorney.  Often, there are problems giving rise to a defense or claim.

    Generally, instead of a voluntary repossession, you are far better off selling or trading in the car and having the proceeds applied to the debt.  This is because  auto finance companies generally sell repossessed cars at auto auctions at a depressed price.  You can generally do better on their own.  The auto finance company has to consent to a sale, but if they refuse to do so and then sell the car for less, that is not commercially reasonable and may get you out of any deficiency.

    Free credit reports

    Monday, July 22nd, 2013

    How to Order Your Free Credit Report

    The Fair Credit Reporting Act requires each of the nationwide credit reporting companies — Equifax, Experian, and TransUnion — to provide you with a free copy of your credit report, at your request, once every 12 months.

    The three nationwide credit reporting companies have a toll-free telephone number and mailing address through which you can order your free annual report. The number is 1-877-322-8228. The address is:

    Annual Credit Report Request Service
    P.O. Box 105281
    Atlanta, GA 30348-5281

    There is also a web site, but we do not recommend that you order credit reports through it.

    You may order your reports from each of the three nationwide credit reporting companies at the same time, or you can order from only one or two. The FCRA allows you to order one free copy from each of the nationwide credit reporting companies every 12 months.

    You need to provide your name, address, Social Security number, and date of birth. If you have moved in the last two years, you may have to provide your previous address. To maintain the security of your file, each nationwide credit reporting company may ask you for some information that only you would know, like the amount of your monthly mortgage payment. Each company may ask you for different information because the information each has in your file may come from different sources.

    Other situations where you might be eligible for a free report

    You’re also entitled to a free report if a company takes adverse action against you, such as denying your application for credit, insurance, or employment, based on information in your report. You must ask for your report within 60 days of receiving notice of the action. The notice will give you the name, address, and phone number of the credit reporting company.

    You’re also entitled to one free report a year if you’re unemployed and plan to look for a job within 60 days; if you’re on welfare; or if your report is inaccurate because of fraud, including identity theft.

    Otherwise, a credit reporting company may charge you a reasonable amount for another copy of your report within a 12-month period. To buy a copy of your report, contact the three credit report companies:

    Experian-1-888-397-3742

     

    TransUnion-1-800-916-8800
    Equifax-1-800-685-1111

    For evidentiary reasons, we do not suggest that you obtain a merged credit report for any purpose other than correcting errors made by the company that prepared the merged report.

    Telephone calls seeking payment of payday loans

    Friday, July 19th, 2013

    Question: Can a payday loan company take you to court?    Someone called my house asking for my debit card information to pay off an old payday loan.
    Answer:  A payday lender can sue you   —  if it is a licensed lender.  If it is an internet loan, check with the Illinois Department of Financial and Professional Regulation as to whether it has a payday loan or Consumer Installment Loan license.  If it is not licensed, its loan is unenforceable, there are substantial statutory damages available against the lender,  and any attempt to collect it by a third party is a violation of the Fair Debt Collection Practices Act, among other things.

    However, under NO circumstances should you EVER provide credit or debit card or account information over the telephone.  There are lots of scammers who claim to be collecting loans or debts when they are just trying to steal your money.  They may have some information about you, such as you got a payday loan, or even from whom.  Apparently some crooks acquired information from loan brokers that originate payday loans.

    If someone calls you to collect a debt,  you want a letter from them explaining who they are and what they are trying to collect.  Ask for a street address (not PO Box), and to check them out by contacting the creditor.  This applies to any debt collector that calls you.

    If you have provided financial information to a caller, inform your bank that your account information  has been compromised and close the account, instructing the bank to not honor anything from the caller.  Confirm this with the bank in writing.