Debt collectors have a bad reputation but for good reason. There is a long history of debt collectors using illegal and unethical tactics to recover debts. If you are being harassed by debt collectors, you may be struggling to meet your financial obligations and may need to consider filing for bankruptcy.
In Minnesota, the laws are strict on what debt collectors can and cannot do. Being aware of what is allowed may be helpful. But if debts are starting to overwhelm you, we recommend talking with an experienced bankruptcy lawyer. Here in Minnesota, we at Kain + Henehan have been fortunate to help many individuals to find relief from debt collection by filing for bankruptcy.
Phone Calls
The most common way to collect on a debt is by phone. It is legal for debt collectors to call you, but only in certain circumstances. For example, they can only call you once per day in most cases. Any more than that may qualify as harassment.
However, they cannot call you at work and must stop calling if you ask them to. If you ask a debt collector to stop calling, they can only call you to tell you that they are stopping debt collection efforts or that they will take legal action against you.
Debt collectors must also provide you with a letter of notice that they are trying to collect a debt within the first five days of calling you.
Filing for Bankruptcy Includes Stopping Collections
Debt collectors may say things that will upset you but there are rules for what they can or cannot say. For example, they cannot use abusive or offensive language, lie, or make untrue threats. They should not make up lies about actions they can take against you. A debt collector can tell you that the company will sue you, but only if the company is able and willing to sue you. Otherwise, that is a threatening harassment statement which they cannot use.
One of the benefits of filing for bankruptcy includes stopping collections. When you file for bankruptcy, an automatic stay goes into effect that stops most collection activity against you. According to the United States Courts on bankruptcy, “The debtor is protected from lawsuits, garnishments, and other creditor actions while the plan is in effect.”
Debt Collectors Pay the Cost of Collections
Debt collectors must bear the cost of collections and cannot pass those costs onto you. The collector is responsible for paying for calls and any other costs related to collecting the debt. A collection agency generally works on contingency meaning they are entitled to their fee only after successfully collecting the debt.
Schedule a Consultation With a Minnesota Bankruptcy Lawyer
If you have debt collectors calling you and you’re considering filing for bankruptcy to handle your debts, contact us. Kain + Henehan is a well-respected and experienced Minnesota bankruptcy law firm. We believe getting advice from a bankruptcy lawyer can help you make better-informed decisions about recovering from your debts.
We understand that thinking about bankruptcy can be intimidating but talking with us should not be. We are a boutique bankruptcy law firm serving all of Minnesota. Bill Kain is based out of the St. Cloud office and Margaret Henehan is based out of the Twin Cities office. All appointments can be conducted virtually as well.
Contact Kain + Henehan by calling (612) 438-8006 or filling out the online form to tell us more about your situation and learn more from an experienced Minnesota bankruptcy lawyer.
