McDonald v. Asset Acceptance LLC Michigan Debt Defense

Limits the rights of Debt Buyers in Collections Matters

Our office has worked extensively with the collectors and lawyers representing Asset Acceptance, LLC. This debt collection company was recently involved in a class action lawsuit. The Plaintiffs in the lawsuit were people like the people we often represent who had defaulted on a loan which had been sold to Asset Acceptance. In order to understand the opinion, it is critical to understand the definition of “charge-off” with respect to a debt. According to the opinion “At some point after Plaintiff’s default, the original creditor determined that these respective debts were uncollectable, and therefore decided to ‘charge-off’ the debt… Creditors charge-off debt in accordance with federal regulations that permit the creditor to remove the debt from their financial records. See Victoria J. Haneman, The Ethical Exploitation of the Unrepresented Consumer, 73 Mo. L. Rev 707, 713-14 (2008) … These accounts are treated as a loss wherein the creditor receives a tax deduction under the Internal Revenue Code[1]. Id. at 714. Asset purchased Plaintiff’s charged-off accounts for pennies on the dollar and began its own collection efforts.” At this time the Defendant Asset Acceptance began to charge interest on the notes which had already been charged-off by the original creditors.

The issue in this case is whether the original creditor can continue to charge interest on the debts once they are charged off. The Plaintiff’s argue that since Asset Acceptance, as assignees of the note, stand in the shoes of the original creditor with no greater rights. As such, interest could not be collected without violating the Fair Debt Collection Act. The court sided with the Plaintiffs holding that “Because [the original creditors] waived the interest, Asset could not retroactively impose interest for the period in which it did not own the accounts.” McDonald v. Asset Acceptance, LLC, United States District Court, E.D. Michigan, Southern Division. Aug 7 2013. Slip. Op.

So, what does this mean for you? The holding is relatively narrow as applied to most debtors. However, if you believe that interest was accrued between the time your note was charged off, and purchased by the collections company, you may be entitled to a reduction in total balance.

For clarification of this, or other debt collection matters, contact Garmo & Kiste, PLC, at (248) 398-7100 for a free consultation or contact us with a private message. We are experienced Michigan attorneys with offices in Troy, MI.

Debt and How to Deal It

It’s now 2014 and in the third week of January. People were supposed to embrace new year happily yet not all can afford so. For some, this week could be payday and then going out shopping while for the rest it might be the final straw of their finances. It’s all because of unpaid DEBT! Actually, debt isn’t bad at all. The bad thing is not being able to pay for it.
Debt comes with several consequences – financially, emotionally and soon physically.

Does Debt Define You? | On Better Terms

http://blog.avantcredit.comThu, 31 Oct 2013 23:00:53 GMT

There are a myriad of emotions when you are dealing with debt. There are quite a few people that allow those emotions to get the best of them. I was one of them, until I realized that I was letting debt define me.

Thus, to avoid mountain-high debt and daunting, here are some tips that you might want to look into:

6 Tips For Dealing with Debt Collectors | 101 Financial Blog

http://blog.101financial.comThu, 02 Jan 2014 20:13:25 GMT

6 Tips For Dealing with Debt Collectors If you’ve ever had to deal with debt collectors, you know how horrible an ordeal this can be. Today I have six tips for you, to help you deal with debt collectors… 1. Stay calm and deal with them head on.

Red to Black: Tips for Overcoming Debt | DoDLive

http://www.dodlive.milTue, 26 Nov 2013 13:00:43 GMT

Managing your finances takes time, effort, education, patience and perseverance. Perseverance especially pays off if you’re managing debt during a particular moment in your financial life cycle. Managing debt can be …

Life isn’t easy. We all know that! But having bad debt will just worsen things. If you still feel overwhelmed and needs advice, you can contact Debt Destroyer Attorney and let them deal with your creditors. Remember, spend your money wisely!

Do You Have Mounting Debt? Michigan Debt Attorney

Have you been sued on a bank loan, by a medical provider, by a credit card company, or by a former landlord?  Let us help you.  The experienced debt collection attorneys of Garmo & Kiste, PLC now specialize in debt collection defense and bankruptcy work.  In the past, we learned the trade by working for credit card companies and debt collection agencies.  Now, we’ve taken that knowledge and applied it as the foundation for a strong debt collection practice, fighting with diligence and drive to relieve numerous clients of the stress and pressure of this kind of lawsuit. Every year, we handle hundreds of collections and collections defense cases.

For more information or to retain Garmo & Kiste, PLC, call us at (248) 398-7100 or send us a private message for a free consultation.  We are licensed Michigan attorneys with offices in Troy, Brownstown, and Lake Orion, MI.

Our Familiarity with Collections Industry:

Aside from our practical experience in this area, one of the greatest advantages of hiring our firm comes from the professional connections we bring to the process.  In any given case, we typically know the plaintiff, the plaintiff’s attorney, the court, and the presiding judge– all thanks to our past employment.  These relationships mean we know what we’re up against from square one, allowing us to quickly assess the facts of your case and determine the best course of action.  This, in turn, helps us reach the best possible result for you, our client.  Additionally, hiring an attorney who practices in the county where you were sued is particularly helpful– we regularly practice in Oakland, Macomb, Wayne, and Lapeer Counties.  Because we frequently appear in the same courts over and over, we know the ins and outs of fighting this kind of claim.  We know more loopholes than most attorneys, and we can accurately assess the matter and predict an outcome as it progresses through all stages.  Ultimately, this means we know when it’s time to fight and when it’s time to settle, getting you the best results possible.

Michigan Debt Attorney call us at (248) 398-7100 or send us a private message for a free consultation.

Another Reason to be Wary of Bankruptcy…

We advise our clients to avoid filing bankruptcy if at all possible.  While bankruptcy might seem like a quick way to escape mounting financial obligations, it can have many effects on your existing debts, properties, and assets, as well as your financial future.

And for the dishonest, it can also impact your criminal record, as illustrated in the case of a local man now facing up to 20 years in prison and up to a $250,000.00 fine after making fraudulent claims on his bankruptcy filing.  Filing bankruptcy requires disclosure of all of one’s personal property under penalty of perjury, and while it may be easy to think that no one’s paying much attention to whether those claims are accurate, this man learned the hard way when the IRS caught his failure to report luxury cars, jewelry, and cash in his bankruptcy filing.

This just goes to show that, even for people who can perhaps afford their debts, bankruptcy can seem like a miracle cure when the stresses of meeting one’s financial obligations begin to build up.  But the consequences are not all good, especially in a case like this one.  In this economy, a high volume of bankruptcies can make it easy to think that an inaccurate filing might fly easily under the radar.  This local incident serves as a good lesson that this behavior does not go unseen—bankruptcy filings are carefully monitored, and those trying to cheat the system will likely be caught.

If you’re struggling financially and considering bankruptcy, call our office today at (248) 398-7100or send us a private message for a free consultation.  We are licensed Michigan attorneys with offices in Troy, Brownstown, and Lake Orion, MI, and our skilled attorneys can work with you to explore all of your options for taking care of your debts effectively and efficiently, while avoiding the implications of a bankruptcy filing.

Census Bureau Reveals Interesting Debt Statistics

According to a recent report by the Census Bureau, the amount of Americans in debt dropped by five percentage points between the years 2000 and 2011.  After a more-than-difficult latter half of the decade, this decrease (down to 69% from 75%) seems welcome and perhaps a bit surprising. However, there’s a catch.  While the number of Americans in debt decreased, the median debt load for Americans who have it increased, from around $51,000.00 in 2000 to $70,000.00 in 2011.

Much of this trouble lies on the relative ends of the age spectrum– debt owed by seniors doubled, most likely due to their rising housing debt. On the other hand, the biggest dollar increase in debt occurred among 35 to 44 year-olds, owing a median of $108,000.00. And while the number of Americans holding credit cards is down significantly (down to 38% from 51%), those holding other forms of unsecured debt, such as student loans and uninsured medical bills, increased from 11% to 19%, especially among those under 45.

While less Americans are finding themselves in debt today, these numbers make it clear that the stresses of debt aren’t going away any time soon.  More than half of Americans are still in debt, and the amount of that debt is on the rise.  However, it’s not an endless tunnel.  If you have financial obligations that you simply cannot afford—whether you’ve been sued already or not—call us today at (248) 398-7100 or send us a private message for a free consultation.  We are licensed Michigan attorneys with offices in Troy, Brownstown, and Lake Orion, MI, and our expect collection defense and bankruptcy attorneys can work with you and with your creditors to determine the best solution possible and help you move on with your life.

Garnishments and Relief from Garnishments

A garnishment is a way for a plaintiff with a valid money judgment against individual to collect on that judgment.  It does so by ordering a third party (the garnishee) to pay money that would otherwise be owed to the individual directly to the plaintiff. There are three common types of garnishments: (1) Wage Garnishments, (2) Bank Garnishments, and (3) Tax garnishments. Wage garnishments can be a shocking and traumatic event– suddenly 25% of your income disappears. Worse yet, this can be embarrassing and an inconvenience to your employer or others with whom you are dealing. Bank accounts, too, can be taken to help satisfy a money judgment and as such, are likely to be effective against many individual debtors.  Finally, Income Tax Refund Garnishments, as with wage garnishments, can be taken to help satisfy a money judgment by offsetting your debt with your tax refund.

Note that sometimes, garnishments can happen without a court judgment.  This is allowed wen the garnishment is for the purpose of repaying a defaulted student loan, court ordered child support, child support arrears or unpaid taxes. Further, with child support, unpaid student loans, and unpaid taxes, the amount that can be garnished is also different.

While this is an unfavorable situation, there are protections for individuals who have been subjected to a writ of garnishment.  For example, it is illegal in Michigan for an employer to terminate, discipline, or refuse to hire an employee due to wage garnishment.  There is also a cap on the amount of money that can be taken from you.  Typically, the total amount of all garnishments may not exceed 25% of the individual’s income. Similarly, there are also exclusions to the kinds of income that can be subject to a garnishment.  For example, Social Security Income may not be garnished.

If you have been served with a writ of garnishment and object to the writ, we can assist you.  Once a writ of garnishment has been awarded, it is difficult to undo, but not impossible—we have successfully made objections to the courts in the past.  But note, too, that an objection must be based on the one or more of the following:

• the funds or property are exempt from garnishment by law
• garnishment is precluded by the pendency of bankruptcy proceedings
• garnishment is barred by an installment payment order
• garnishment is precluded because the maximum amount permitted by law is being withheld pursuant to a higher priority garnishment or order
• the judgment has been paid
• the garnishment was not properly issued or is otherwise invalid

It also should be noted that in general, your wages, paycheck, or bank account can only be garnished if a judgment is taken against you.  If you are debtor, it is not too late to protest the original debt or other obligation if you were unaware of a judgment or failed to defend a lawsuit in a timely manner.  Violations of these may be grounds to properly objecting to the garnishment.  For example, Social Security Income is exempt from garnishment.  If any of these circumstances apply to you, you should consult with an attorney immediately.

Installment Payment Plans

Have your wages been garnished?  Let us help you get the garnishment removed. If you have a judgment against you, with limited funds to pay it, we can file a motion with the court to put you on a monthly payment, setting up a repay plan that puts you on your terms, not theirs. This also helps avoid any further inconvenience to your employer or anyone else affected by the terms of the writ.  Further, as a last resort, we can look into bankruptcy—this, too, will stop the garnishments.

We understand that garnishment can be frustrating and traumatic, and that addressing the problem can be painful and requires hard work. However, the sooner you face the problem, the sooner you can take care of it and make positive changes to improve your debt situation in the future.  Avoiding the problem or delaying changes to your habits will only prolong the problem and make it worse.

We are here to help you.  For more information or to retain Garmo & Kiste, PLC, call us at (248) 398-7100 or send us a private message for a free consultation.  We are licensed Michigan attorneys with offices in Troy, Brownstown, and Lake Orion, MI. Payment plans are available, and as always, you are under no obligation to retain our services and our advice during the consultation is free.

Do You Have Mounting Debt?

Have you been sued on a bank loan, by a medical provider, by a credit card company, or by a former landlord?  Let us help you.  The experienced debt collection attorneys of Garmo & Kiste, PLC now specialize in debt collection defense and bankruptcy work.  In the past, we learned the trade by working for credit card companies and debt collection agencies.  Now, we’ve taken that knowledge and applied it as the foundation for a strong debt collection practice, fighting with diligence and drive to relieve numerous clients of the stress and pressure of this kind of lawsuit. Every year, we handle hundreds of collections and collections defense cases.

For more information or to retain Garmo & Kiste, PLC, call us at (248) 398-7100 or send us a private message for a free consultation.  We are licensed Michigan attorneys with offices in Troy, Brownstown, and Lake Orion, MI.

Our Familiarity with Collections Industry:

Aside from our practical experience in this area, one of the greatest advantages of hiring our firm comes from the professional connections we bring to the process.  In any given case, we typically know the plaintiff, the plaintiff’s attorney, the court, and the presiding judge– all thanks to our past employment.  These relationships mean we know what we’re up against from square one, allowing us to quickly assess the facts of your case and determine the best course of action.  This, in turn, helps us reach the best possible result for you, our client.  Additionally, hiring an attorney who practices in the county where you were sued is particularly helpful– we regularly practice in Oakland, Macomb, Wayne, and Lapeer Counties.  Because we frequently appear in the same courts over and over, we know the ins and outs of fighting this kind of claim.  We know more loopholes than most attorneys, and we can accurately assess the matter and predict an outcome as it progresses through all stages.  Ultimately, this means we know when it’s time to fight and when it’s time to settle, getting you the best results possible.