Attorney at Law | LaPorte, Indiana
Federal statutes, such as the Fair Credit Protections Act, establish the legal field of play in which creditors can attempt to collect consumer debt. Where they may contact a debtor, how they may contact a debtor and when they may contact a debtor are provided for in this federal statute. If you are represented by an attorney, creditors are not allowed to contact you personally under the Fair Debt Collections Act.
A creditor is entitled to certain remedies in an effort to obtain a debt in which they are entitled. However, if you are a creditor, you must follow certain legal procedures to recover any funds owed at the lowest cost to you. If not done precisely, you may find that you are unable to recover the money you are rightly due. Further, specific acts could lead to an award of punitive damages against you should you fail to comply with state and federal requirements prescribed by law as a means of collecting a debt.
First, a debtor must be notified that they are being sued in court and they have 20 days (23 days by mail) to respond or contest the amount the creditor claims that is owed by the debtor in writing. If this is not done, quite often a money judgment by default is awarded the creditor. A money judgment is an order by the court, which determines that a debtor owes a specific sum to a creditor. In the state of Indiana, a bank account cannot be frozen or a garnishment cannot be obtained until a money judgment has been awarded by the court. If your account contains certain funds such as Social Security Benefits, these funds are exempt and cannot be frozen, garnished or otherwise reached by the creditor unless that creditor is the government or you happen to owe back child support.
Next, a creditor will file a summons to a proceeding referred to as Proceedings Supplemental. At this proceeding, the creditor will often informally, but sometimes on the record attempt to determine whether or not the debtor possesses any assets that can be garnished, frozen or any property worth placing a lien upon. In most instances, the creditor will also send a list of questions called “interrogatories” to your employer, which will make certain inquiries regarding your pay as well as other aspects of your employment. If your employer does not fill out this form, they employer will be required to appear at the Proceedings Supplemental and give testimony about your wage, benefits, and employment. An employer almost always fills out the form and submits it to the court in lieu of appearing at the Proceedings Supplemental in person.
In this tough economic climate, collecting money owed as well as protecting what money you have are of paramount importance whether you are a creditor or debtor. The Law Office of Shane B.C. Watson will address your concerns and discuss your legal options call 219.369.6892, email or feel free to use the contact form provided on the site to set up a free consultation with an attorney.