Wednesday, July 14, 2010
Common Debt Collection Practices Under Florida Law
In a climate where more consumers are struggling to meet their credit obligations, creditors and debt collectors are becoming highly aggressive in their attempts to collect consumer debts. Federal Trade Commission (FTC) complaints are up by fifty percent (50%) in 2009 and are on track to jump an additional thirteen percent (13%) by the end of 2010. Despite increased complaints to the FTC, creditors and debt collectors continue to march over federal and state consumer protection statutes on their way to collecting debts. This article addresses the impact of the Florida Consumer Collection Practices Act (FCCPA), on common consumer collection issues.
Prior to resolving a debt, collection calls are the most common collection issue encountered by consumers. When dealing with credit card accounts or mortgage debts, collection calls begin immediately upon delinquency. The FCCPA provides consumers broad protections and consumer rights. For example, drastically limits the frequency and manner of collection calls. With very few exceptions, creditors are forced to cease communication with the consumer and must communicate strictly with the attorney.
After a debt is resolved and is no longer collectable, consumers may continue to experience collection activities and improper credit reporting. Specifically for struggling homeowners, many turn to a short sale transaction as way to resolve a mortgage debt and avoid a foreclosure. The collection of a short sale deficiency where a lender forgave the mortgage debt is the collection of an illegitimate debt and a violation of the FCCPA. Another common consumer protection issue following completion of a short sale is improper credit reporting. It is a violation of the FCCPA for a creditor to knowingly publish false information about a consumer's creditworthiness. It is not uncommon for completed short sale transactions to be improperly and falsely reported to the various credit reporting bureaus.
Every consumer collection activity that occurs in the state of Florida is subject to the FCCPA. The examples cited above are only a few examples of collection activities that potentially violate Florida law. In addition, there are a number of other collection activities that are improper in the state of Florida. It is also important to note that federal laws may apply in these situations including but not limited to, the Fair Debt Collection Practices Act and the Fair Credit Reporting Act. Enforcement of the FCCPA is left to individuals and private attorneys. When faced with a collection activity, a consumer can maximize their consumer rights and limit collection activity by acting immediately.
Tuesday, July 13, 2010
New Bill Demands HOA Fees Paid by Tenants
As of July 1, 2010, the Florida's Senate Bill number 1196 will take effect. One of the changes that will accompany this new bill is the right of Homeowner Associations to demand payment, without taking legal action, from tenants occupying a unit owned by a non-paying, non-resident owner. If a parcel is occupied by a leasing tenant and the owner is delinquent on any financial obligation to the association, the association may demand the tenant to cover these delinquent amounts. This obligation continues until the association releases the tenant or the tenant vacates the unit.
If the tenant has prepaid several months of rent at the time the tenant receives notice of the obligation to pay the outstanding amount, the tenant has fourteen days from the date of receipt of the demand to provide the association with written evidence of prepayment. If the tenant provides this written evidence, he or she will receive a credit in the amount of prepaid rent. Likewise, the tenant will receive a credit against rent payments due to the owner of the parcel in the amount surrendered to the association for delinquent monetary obligations.
A tenant will not be responsible for increases in the amount of monetary obligations due the association unless the tenant receives written notification of the increase at least ten days before the rent becomes due.
Tenants who respond in good faith to their association's demands will enjoy immunity from any landlord-tenant claim brought by the owner. However, if a tenant fails to meet the monetary obligations demanded by the association, the association is within their rights to stand in the shoes of the landlord/owner and file suit for eviction.