ABA Consumer Guide to Understanding and Protecting Your Credit Rights by ED Daniel A. Edelman

Author:ED Daniel A. Edelman
Language: eng
Format: epub
Publisher: American Bar Association
Published: 2017-11-21T16:00:00+00:00

NOTE

Do not assume that if a lawyer files a lawsuit that he or she has the right to do so. Debt buyers and collection attorneys often ignore statutes of limitations, hoping that the consumer will default and a judgment will be entered even though the consumer has a complete defense to the claim.

Filing suit on a time-barred debt not only gives rise to a defense but is a violation of the Fair Debt Collection Practices Act (FDCPA) (Phillips v. Asset Acceptance, LLC, 736 F.3d 1076, 1079 (7th Cir. 2013)). Threatening to file suit on a time-barred debt is also an FDCPA violation. An increasing number of courts hold that a debt collector seeking to collect a time-barred debt who implies that the debt is legally enforceable—such as by offering a settlement—must disclose that the debt is time-barred (McMahon v. LVNV Funding, LLC, 744 F.3d 1010 (7th Cir. 2014)). Some states have passed statutes or issued regulations requiring debt collectors to make this disclosure whenever attempting to collect time-barred debts.

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