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- What is the FDCPA?
The Fair Debt Collection Practices Act (FDCPA) is the federal law that defines and governs how collection agencies can operate. The law protects consumers from abusive collection practices by debt collectors (a debt collector is someone who regularly collects debts owed to others, including coll ...
- What rights do I have under the Fair Debt Collection Practices Act?
Your debt collection rights under the Fair Debt Collection Practices Act include the following: Collectors cannot call you repeatedly with the intent to annoy, abuse, or harass you and are NOT allowed to contact you before 8:00 a.m. or after 9:00 p.m. local time. If you notify a collector in wr ...
- How can I stop a bank levy?
If the IRS freezes your account through a bank levy, you will have 21 days before they seize all of the money out of your account. Take advantage of this short time and take the necessary steps to protect your money: Hardship Plan: Send a letter to the IRS with evidence proving that if they lev ...
- What is a bank levy?
A bank levy occurs when your bank account is frozen and all or part of the money in your account is seized. The most common causes of a bank levy are unpaid taxes and unpaid debt. A bank levy doesn’t happen overnight; usually it is the result of a creditor trying to force a consumer to pay ...
- What are the different types of bankruptcy?
Bankruptcy is a proceeding that legally releases a person from repaying a portion of or all debts owed. Bankruptcy damages your credit for 7-10 years and should be your last resort if you cannot repay your debts. Chapter 7 Bankruptcy: A type of consumer bankruptcy where your responsibility for y ...
- What is a collection account?
If you choose to stop paying on an account or debt, the lender may sell your account to a collection agency. This action turns a credit account into a collection account. Collection agencies specialize in collecting money from people who don’t want to pay. One of the ways they can convince ...
- What is a judgment?
A judgment is a decision from a judge on a civil action or lawsuit, usually containing an amount of money a person is required to pay to satisfy a debt or as a penalty. Judgment records remain on your credit report for at least seven years (longer if they remain unpaid) and harm your credit scor ...
- Am I responsible for my spouse�s debt?
Generally speaking, spouses are only responsible for joint accounts (not just credit card accounts, but installment loans like a car or home too). It doesn’t matter if the couple divorces or one spouse dies – with joint accounts, both are equally responsible for the debt. Like any ot ...
- What is community property?
Community property refers to the law under which most property acquired during a marriage (with the exception of gifts or inheritance) is owned jointly by both spouses and is divided upon divorce, annulment, or death. In the US, there are nine community property states: Arizona, California, Idah ...
- If a spouse or parent dies, can creditors come after family members to collect the debt?
Generally speaking, you are not responsible for other people’s debt when they die, unless you are a co-signer on shared accounts with the deceased. If, however, the deceased is your spouse and you live in a community property state (Arizona, California, Idaho, Louisiana, Nevada, New Mexico ...
- Are children responsible for parents� debt?
No, children are not responsible for their parents’ debt. There is only one exception: If the children co-signed on a loan with their parents, the surviving co-signer would still be responsible for paying back the debt (any co-signer, a child or otherwise, is always responsible for unpaid ...
- What is innocent spouse relief?
Most married couples take advantage of joint filing for the money-saving benefits. But along with the savings comes big disadvantages. When you file jointly, you’re held liable for your spouse’s tax blunders! This means if your spouse under-reports income, you get the blame, too! The ...
- Am I responsible for my spouse�s medical debt?
In many cases, yes, but it depends on the state that you live in. Because of a legal designation called the "doctrine of necessaries”, in many cases spouses are responsible for the other spouse’s medical debt, even if the spouse dies. The largest determining factor is how your state ...
- Can you explain the system of medical debts being sent to collections and appearing on credit reports?
The system is this: you go see a doctor and incur costs. The doctor files a claim with your insurance company and they either don’t pay or it takes too long for them to process your claim. The doctor wants to get paid, so he or she can try and collect the payment by sending the account to ...
- What is the difference between debt consolidation and debt settlement?
Debt consolidation is the process of combining debts into one loan or repayment plan. Debt consolidation can be done on your own, with a financial institution, or through a counseling service. Student loans are often consolidated in order to secure a lower interest rate. Debt settlement is the p ...
- How long do foreclosures or repossessions stay on your credit reports?
Foreclosures and repossessions stay on your credit reports for seven years from the date the incident took place. Not sure where you stand credit-wise? Check your reports and scores online today!
- What should I do if I can�t afford to make my car payments?
If you find yourself unable to keep up with your vehicle loan payments, investigate the following options as soon as possible to avoid a repossession of your vehicle: Modify Your Auto Loan: Talk with your lender. Some lenders will allow their customers to make lower payments for a short period ...
- What is debt settlement?
Debt settlement, also known as debt arbitration or debt negotiation, is an approach to debt reduction in which debtors and creditors agree on a reduced balance that, once satisfied, is considered payment in full. As long as consumers continue to make minimum monthly payments, creditors will not ...
- What is a back end ratio?
Your back-end ratio is the same as your debt-to-income ratio: it's the percentage of your monthly pre-tax income that is used to pay off debts such as auto loans, student loans, and credit card balances. Lenders look at two ratios: The front-end ratio is the percentage of monthly pre-tax earning ...
- Should I try to dispute negative items on my report even though I know they�re correct?
It is not a good idea to knowingly dispute accurate credit information. That is a technique used by credit repair companies. The worst thing you can do is have any of the credit bureaus identify you as someone who is filing frivolous disputes. If this happens, any dispute you file in the future ...
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