Steps in the Debt Collection Process

Post by: Eric Jones | Posted Date: October 6th, 2016 |

Delinquent accounts threaten the survival of organizations ranging from the smallest entrepreneur to the largest public utility. When customers and borrowers will not pay for products, services, loans or property, the individuals and companies they owe have an obligation to collect outstanding debts so they can remain in operation and continue serving other people.

Jones Law Group in Columbus is among the top debt collection lawyers in Ohio. We maintain our reputation by delivering results while fully complying with the federal Fair Debt Collection Practices Act and the Ohio Consumer Sales Practices Act. Violating any of the complex rules put in place to protect debtors from unethical practices and harassment all but guarantees a judge will eventually declare a debt unrecoverable and may result in a creditor owing the debtor monetary damages.

Here is the process Jones Law Group follows when working on behalf of banks, retailers, student loan lenders, debt buyers, and utilities to secure payments from debtors. Note that businesses and institutions can also be debtors subject to collections, but we use individuals in the following discussion to make reading the details easier.

Consult With Client

One thing we ask all potential clients to understand is that while legitimate debts never expire, creditors face statutes of limitations for legally enforcing debtors’ obligations to pay. The two exemptions to this are student loan debt and unpaid fees and fines assessed by a government or law enforcement agency. In all other cases, landlords, financial institutions (including credit card companies), business owners, and health care providers have a fixed amount of time to begin the collection process once debt payments stop arriving.

During our initial consultation over debt collection services, we determine whether the debt is out of statute and discuss whether the person named as the debtor is likely to have the resources to pay. We ensure all clients know up front whether contacting a creditor has a good chance of ending with the settling of the account. Sometimes, writing off a debt as uncollectible or selling the debt to a third party makes the most sense.

Contact Debtor by Mail

Creditor clients must provide us with as much information as possible about how to contact the person who owes the debt. At a minimum, we usually need a full legal name, bank info, Social Security number, and mailing address. We can use a last-known address if necessary, but the person’s name must be confirmed. One of the strongest claims an alleged debtor can make is that he or she is not the person who incurred the debt.

The first contact regarding an unpaid debt that has entered collection must be made by mail. An Ohio debt collection attorney with Jones Law Group will satisfy this requirement by sending a registered letter. The person who receives the notice will then have 28 days to respond.

Possible Responses by Debtor

The debtor can reply to us or the creditor by mail, by phone, or in person. He or she can also hire a legal representative and conduct all communications through that advocate.

The debtor can settle the account, set up a payment plan subject to approval by the creditor, request proof of the debt, and demand that we stop contacting them. A proof-of-debt request suspends the debt collection process until the proof is delivered. A request to cease contact stops the flow of letters and, if necessary, phone calls but does not prevent the creditor from filing a civil court claim for collection.

Contact Debtor by Phone

If a debtor who signs for a collection letter does not respond within a month, we can send one or more follow-up letters or start trying to contact the person by phone, Debt collection phone calls can generally only go to a person’s home phone or cell number between the hours of 8 am and 9 pm local time. Making calls to a debtor’s place of work, to his or her friends and family members, or outside of the statutory hours will often be considered harassment that makes the collection process unlawful. Note, also, that a person calling about an outstanding debt cannot issue threats, misrepresent his or her identity, or imply that failure to pay constitutes a crime.

Possible Responses by Debtor

The debtor has the same options for responding to debt collection phone calls as he or she does when responding to letters.

File Civil Court Claim

When letters and phone calls go unanswered or fail to prompt the debtor to make payments, the creditor can file a lawsuit. Notice of the civil lawsuit must be sent by mail. If the debtor does not reply or fails to appear for the hearing, which will generally be scheduled a month after filing, a summary judgment against the creditor will be requested. Summary judgments can include the amount of the outstanding debt plus interest, collection fees, and court costs.

Methods for enforcing a debt judgment include a court order to pay in full, a court-order to pay in installments, wage garnishment, and property sale or seizure. An Ohio debt collection attorney with Jones Law Group can advise a creditor on which option offers the greatest likelihood of having the account settled.

To discuss debt collection services, call us at (614) 545-9998 or request an appointment online.

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