Debt Collection

Incidence of debt collectors using illegal practices to collect money from consumers is at an all-time high.  Unscrupulous debt collectors frequently intimidate consumers, using unfair tactics and misrepresentations.  Many debt collectors also try to make consumers pay bills that they do not owe.  These situations usually arise from fraud on the debt collector’s part, bankruptcy, or identity theft.  Often, debt collectors illegally deduct funds from the alleged debtor’s bank account without consent or try to collect debts that are decades old.  Under the Fair Debt Collection Practices Act, it is illegal for debt collectors to utilize unfair and deceptive debt collection practices, including the use of abusive or threatening language; calling at unreasonable hours; calling the alleged debtor’s friends, family, or workplace; or threatening to have the alleged debtor arrested or jailed.  If you believe you have been victimized by a debt collector who uses illegal debt collection practices, you should contact me; I am an attorney who specializes in consumer law.

Repossessions

If your property has been repossessed, you may feel helpless and that you have no rights.  However, creditors and the repossession companies they hire must obey Minnesota consumer protection laws.  After a repossession, a creditor cannot sue you for additional money if the value of the collateral is below a certain dollar value, except under certain circumstances.  If you are sued by a creditor or contacted by a collection agency, it is important to respond promptly and not ignore the notices.  You should call me for a free consultation so I can help you determine your best course of action.  If you ignore the notices, you may lose your legal rights.  The longer you wait to address the situation, the less willing a judge will be to set aside any default judgments posted against you.  Contacting me with questions will not cost you anything; I offer free consultations and case evaluations.  I do not usually charge you a fee.  If you settle your case, attorney’s fees are usually figured into the settlement and usually do not come out of your pocket.  On the other hand, if you win your case, the law usually requires the wrongdoer to pay your attorney’s fees.

Foreclosures

For a variety of reasons, foreclosure rates are increasing.  If you receive a letter from your lender stating your mortgage payments are overdue, your lender is starting the foreclosure process.  The letter will indicate the amount you owe and usually indicate that you have one month to pay the overdue amount.  If you do not pay the overdue amount, your lender can bring foreclosure proceedings against you and set a date for a sheriff’s sale.   Within six months after the sheriff’s sale, if you are able to pay the highest bid placed at the sheriff’s sale, you can “redeem” and get your house back.  Otherwise, you will be required to move from your house six months after the sheriff’s sale.

Before and after the sheriff’s sale, you have important rights.  Before the sheriff’s sale, you have the right to force the lender to stop the foreclosure proceedings by paying what you owe.  After the foreclosure sale, you can pay the highest bid placed at the sheriff’s sale and keep your home; sell your home for a higher price, pay the highest bid placed at the sheriff’s sale, and keep the difference; or live in your home for another six months without making any payments. 

When foreclosure proceedings begin, the paperwork the lender files becomes public.  Unscrupulous lenders that learn about your foreclosure may approach you and, pretending to want to help you, offer to purchase your home and sell it back to you in the future.  Avoid this scam; it is called “equity stripping”.  If you agree to sell your home to the unscrupulous lender, he/she will steal the down payment and mortgage payments you have made up to that point.  If you have any questions about the foreclosure process or foreclosure-related scams, you should contact me.

Loans, Credit, Banking

Businesses obtain a consumer’s credit report for a number of different reasons.  Businesses evaluate a consumer’s credit report to determine whether a consumer will be issued credit cards, whether a consumer will get a mortgage, or whether a job applicant will get a job.  In addition, credit reports contain sensitive information concerning lawsuits, arrests, and bankruptcies.  For these reasons, it is important that credit reports contain only accurate information.  If there is incorrect information on a credit report, the affected consumer has rights under the Fair Credit Reporting Act, including the right to force credit reporting agencies to investigate the disputed item. 

All consumers should request their credit report every few years and before any large purchase to avoid unwanted surprises.  Consumers should also evaluate their credit report if they have been denied credit or employment.  Typically, a consumer will be required to pay a reasonable fee to obtain the credit report.  However, if the consumer has been denied credit or employment, the business that sent the denial letter is required to reveal the name of the credit reporting agency that supplied the unfavorable information.  If the consumer requests a credit report from that credit reporting agency within 30 days of the unfavorable decision, the credit reporting agency is required to provide a copy of the credit report for free.

If a credit report contains inaccuracies, the affected consumer has the right to have the credit reporting agency investigate the accuracy of the credit report.  After the dispute, the credit reporting agency must investigate the matter within a reasonable period of time.  If the credit reporting agency determines that the information is inaccurate or unverifiable, the information must be removed from the credit report. 

Arbitration Agreements

An arbitration agreement that appears in a contract indicates that the parties to the contract waive their right to a trial if a contractual dispute arises.  Instead, the parties agree to bring their dispute before a neutral decision-maker, whose decision is binding and sometimes cannot be appealed.  An arbitration hearing is similar to a lawsuit in some ways but differs in other ways.  In some situations, arbitration may be more desirable than a lawsuit.  Arbitration usually involves simpler pleading requirements, relaxed evidence rules, lower fees, less discovery, more flexible scheduling, and privacy.  However, there are people who would prefer their “day in court”.  When an arbitration clause appears in a contract, it can be avoided if the parties agree to settle their dispute in court, if enforcement of the clause would be contrary to law or if a party was defrauded.  If you believe you were tricked into arbitration or if the arbitrator will not provide all the remedies available to you under law, you should contact me to discuss your situation.

Deception and Fraud

The law recognizes many types of fraud.  A person commits fraud when he/she knowingly or recklessly deceives someone, causing that person to suffer some type of harm.  In order for someone to be liable for fraud, the lie cannot be so outrageous that no reasonable person would believe it.  In addition, the lie must concern an important fact relating to the transaction.

Fraud is an area of the law that is affected by many factors.  One factor is whether the statement at issue is a statement of fact or opinion.  A fraudulent statement must be a false statement of fact.  Puffery, on the other hand, is a statement of opinion that is not actionable.  Another factor that impacts whether one’s conduct constitutes fraud is the relative intelligence of the parties.  Often, a seller is a seasoned salesperson with superior knowledge of the item being sold.  These sellers know that inexperienced buyers rely on his/her superior knowledge in deciding whether to make a purchase.  In this situation, a misrepresentation on the part of the seller is more likely to rise to the level of fraud than if the seller is not an expert.  However, non-experts may certainly commit fraud.  For example, a private party that lists a flood-damaged car on carsoup.com and tells a buyer that the car has never had problems is guilty of fraud.

Fraud is a complicated area of the law that permits a victim to seek many types of damages, including actual damages and punitive damages.  If you believe that you are the victim of fraud, you should contact me for a free case evaluation.

Auto Fraud / Lemon Law

The Lemon Law protects purchasers of new vehicles.  Lemon laws provide that if the seller of a new vehicle cannot repair a material defect after 4 repair attempts, if a new vehicle is out of service for 30 business days within the first two years of ownership due to a material defect, or if the vehicle has a defect that makes it dangerous to operate, the seller must refund your money or replace the defective automobile.  Although a material defect is considered to be one that substantially impairs the use, value, or safety of the vehicle, most defects fall into this category.

Although the Magnuson-Moss Act (lemon law) protects only purchasers of new cars, there are a number of state and federal laws that protect purchasers of both new and used vehicles, including misrepresentation/fraud, odometer rollback statutes, and salvage reporting statutes.  If you believe you bought a “lemon” or were defrauded in connection with the purchase of an automobile, you should contact me for legal advice regarding the situation.

Warranties

Warranty law is a complicated area of the law that focuses on a seller’s willingness to stand behind a product he/she sells and repair any defects that arise.  There are two basic types of warranties; these are express warranties and implied warranties.   Express warranties are oral or written promises that a seller makes concerning the quality of a product and his/her commitment to remedy malfunctions that a buyer might experience.  An implied warranty can be a warranty of fitness for a particular purpose or a warranty of merchantability.  An implied warranty of merchantability is a promise made by a merchant that the item sold is fit to be used for its ordinary purpose.  An implied warranty of fitness for a particular purpose arises when a seller that is familiar with a buyer’s needs assures the buyer that the product will suit those needs.   Sometimes sellers refuse to honor warranties.  When this happens, the buyer has a right to go to court to have the warranty enforced.

Predatory Lending

As the number of foreclosure actions filed in the U.S. skyrockets, the number of predatory lenders that prey on vulnerable homeowners also skyrockets.  Unscrupulous lenders employ a number of tactics to take advantage of unsophisticated borrowers.  One tactic that predatory lenders use against homeowners in foreclosure is called “equity stripping”.  A predatory lender approaches a homeowner in foreclosure and offers the homeowner a loan that the lender knows the homeowner cannot afford.  After the homeowner accepts the loan, the lender sits back, waiting for the homeowner to default on the loan so the lender can begin foreclosure proceedings and steal the homeowner’s equity.  Predatory lenders employ other tactics to get money they don’t deserve.  Some lenders fail to post payments on the date of arrival so they can collect late fees.  Other predatory lenders make drastic changes to the terms of the loan moments before closing. 

Another common practice employed by predatory lenders is to improperly change the borrower’s interest rate on adjustable rate mortgages.  If a borrower fails to make a payment, some lenders violate the Fair Debt Collection Practices Act when they try to collect overdue payments.  If you believe you are being victimized by a predatory lender, the law is on your side; you should contact me.